EMERGING MARKETS-Brazil's real rises, with eyes on vaccination campaign

Shreyashi Sanyal
·2 min read

(Updates prices throughout) By Shreyashi Sanyal Jan 18 (Reuters) - Brazil's real rose on Monday as the country geared up to send vaccine doses across its states later in the day, while most other currencies in Latin America were subdued against a stronger dollar. The real gained 0.6% to 5.26 against the dollar, with investors eying the start of a vaccination campaign beginning at 5 p.m. (2000 GMT) on Monday, a plan that was initially due to start on Wednesday. Brazil will roll out the only vaccine available from the government - the CoronaVac shot made by China's Sinovac Biotech and imported by the Butantan biomedical center in Sao Paulo. "Despite COVID-19 and domestic fiscal uncertainty, mostly due to the global inflow of capital to the EM sphere, we still see the USDBRL trading at 5.05 by end-2021 and 4.95 by end-2022," said Mauricio Une, senior strategist at Rabobank. Data showed economic activity in Brazil rose in November for a seventh straight month, slightly more than economists had expected although it was the smallest increase during that growth streak. Other currencies in Latin America fell as the dollar continued its rally to hit a four-week high, with markets watching the new U.S. administration's stance on the greenback as President-elect Joe Biden prepares to take office on Wednesday. Mexico's peso was up 0.4% against the dollar. The peso was lower earlier in the session as oil prices weakened on rising coronavirus cases and a slowing pace of vaccinations across the world. The Chilean peso was flat. The country's central bank last week announced a plan to purchase $12 billion over the next 15 months to replenish and expand its foreign currency reserves. Among stock indices in the region, Brazil's Bovespa added 1.5% after data showed China's economy picked up speed in the fourth quarter and remained poised to expand further this year even as the global pandemic rages unabated. China is the biggest importer of agricultural goods and metals from Brazil. Trading activity remained quiet on Monday, with U.S. stock markets shut for the federal Martin Luther King Jr. holiday. Key Latin American stock indexes and currencies at 1819 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1359.04 0.07 MSCI LatAm 2519.30 1.53 Brazil Bovespa 122175.82 1.52 Mexico IPC 46253.28 0.79 Chile IPSA 4614.89 0.94 Argentina MerVal 50105.62 -0.783 Colombia COLCAP 1447.51 -0.35 Currencies Latest Daily % change Brazil real 5.2694 0.63 Mexico peso 19.6950 0.39 Chile peso 733.6 -0.03 Colombia peso 3480.04 -0.58 Peru sol 3.6137 -0.03 Argentina peso (interbank) 86.0600 -0.37 Argentina peso (parallel) 155 2.58 (Reporting by Shreyashi Sanyal in Bengaluru; Editing by Steve Orlofsky and Jonathan Oatis)