* Barclays latest bank to lower Brazil GDP forecasts
* China cuts medium-term rate to ease coronavirus hit
* Chile central bank to hold interest rate for at least a
year
By Shreyashi Sanyal
Feb 17 (Reuters) - Stocks in Latin America edged higher on
Monday as investor anxiety around the impact of a coronavirus
outbreak was soothed by China's stimulus measures, but Brazil's
real looked shaky after a gloomy outlook on economic growth.
China's central bank cut its medium-term lending rate on
Monday, which also fanned expectations for a reduction in the
country's benchmark loan prime rate (LPR).
The cut helped Chinese stock markets rise while lifting
sentiment globally. MSCI's index for Latin American equities
rose 0.2%.
"The economic impact of the stimulus, however, will struggle
in the face of the measures needed to contain the spread of the
virus," said Jane Foley, senior FX strategist at Rabobank.
As the virus outbreak continued unabated, officials said the
total number of cases rose by 2,048 to 70,548 as of Monday.
Markets in Latin America have taken a hit from the outbreak
in China, which is one of the region's top export destinations.
Brazil's real fell against the dollar, as economists
at Barclays became the latest bank to have cut their growth
forecasts, to say the spillover from disappointing data late
last year means growth this year will now be barely above 2%.
The real, which was also battered in 2019 by failed oil
auctions, is among the worst performing regional currencies
against the greenback.
In Chile, the peso weakened slightly. The country's
central bank will hold its interest rate at 1.75% for at least
another year, a poll of 59 traders showed, as policymakers are
seen opting for long-term stimulus to ease the economic pain of
months of unrest in 2019.
In Argentina, analysts said on Friday the country's bond
market could take another beating if debt renegotiations take
longer than expected.
Investors last week digested the government's unilateral
postponement of a $1.47 billion payment on its AF20 bond from
Thursday until Sept. 30, and comments from economy chief Martin
Guzman who warned that a "deep restructuring" was on the way.
Key Latin American stock indexes and currencies at 1456 GMT
Stock indexes Latest Daily %
change
MSCI Emerging Markets 1107.93 0.15
MSCI LatAm 2788.10 0.15
Brazil Bovespa 115267.72 0.78
Mexico IPC 44981.94 -0.04
Chile IPSA 4630.78 -0.54
Argentina MerVal 38782.26 0.348
Colombia COLCAP 1661.96 -0.15
Currencies Latest Daily %
change
Brazil real 4.3223 -0.53
Mexico peso 18.5654 -0.17
Chile peso 793.2 -0.30
Colombia peso 3397.02 -0.25
Peru sol 3.3818 -0.11
Argentina peso 61.5000 -0.07
(interbank)
(Reporting by Shreyashi Sanyal in Bengaluru
Editing by Sonya Hepinstall)
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