EMERGING MARKETS-Latam FX mixed as investors assess US data; Banxico in focus

By Johann M Cherian

Most Latin American currencies were mixed on Thursday as investors took stock of a long-awaited U.S. jobs report, while Mexico's peso wavered as central bank minutes indicated policymakers were willing to take a measured approach to monetary policy easing.

MSCI's index tracking Latin American currencies .MILA00000CUS was little changed versus the dollar =USD, while an index tracking regional stocks .MILA00000PUS inched up 0.5%.

Latin American assets have had a stellar year, with the MSCI stocks index on track for its biggest annual gain since 2009, while the currencies index is poised to log its steepest gain ever.

EMERGING MARKETS GAINED FROM RELATIVELY LOWER U.S. TARIFFS

Risk sentiment got a boost this year from lower U.S. tariff rates for emerging market economies than most other economies, coupled with elections that yielded support for market-friendly candidates in Argentina, Bolivia, and Ecuador.

"People are starting to think what 2026 might look like," said Eduardo Ordonez Bueso, an emerging markets debt portfolio manager at BankInvest.

"Everything is so expensive across the board. So it's just about recalibrating and thinking about what is desirable after a strong year's performance."

A report showed that U.S. job growth accelerated in September but the unemployment rate rose to 4.4% and the economy shed jobs in the prior month, suggesting labor market conditions remained sluggish.

The report was delayed due to a prolonged U.S. government shutdown, during which investors and policymakers had little clarity on the health of the world's largest economy and the direction the Federal Reserve could lean at its December meeting.

Thursday's data cemented expectations that the Fed could leave interest rates unchanged.

In Mexico, the focus was on minutes from the central bank's meeting this month, when it cut borrowing costs to their lowest since 2022 and projected further monetary policy easing.

Banxico minutes showed that all board members saw inflation risks skewed higher within the forecast horizon, though most noted this bias is less pronounced than in 2021–2022.

The peso MXN= was flat in choppy trading, while local equities .MXX rose 0.8%.

Separately, preliminary data showed the Mexican economy was flat in October from a year earlier.

Copper exporter Chile's peso CLP= edged up 0.6%, tracking higher prices of the red metal.

AI leader Nvidia's NVDA.O strong results aided a global relief rally on Thursday, and many analysts attributed the gains in copper prices to the surge in demand for wiring in AI data centers under construction. MET/L

Colombia's peso COP= lost 0.6%. The country's fiscal rule committee said the fiscal deficit will total 6.7% of gross domestic product this year, below a 7.1% target.

Brazil markets were closed for a public holiday.

Key Latin American stock indexes and currencies: