Brazil's central bank to hold rates steady on July 31, poll says
Mining giant Vale says second-quarter net profit triples
Chile's central bank to keep key rate at 5.75%, poll says
Stocks up 0.4%, currencies down 0.3%
Updated at 3:40 p.m. ET/ 1940 GMT
By Johann M Cherian and Shashwat Chauhan
July 26 (Reuters) - Most currencies in Latin America were set for weekly losses on Friday on the back of price drops in commodities such as copper and iron ore, while global risk markets remained stable after data showed an improving U.S. inflation picture.
MSCI's index tracking currencies in the resource-rich region slipped 0.3%, and was poised for a weekly drop of 1.9%, its steepest decline in more than seven weeks.
Brazil's real dipped 0.3%, but was set to end the week lower by over 1%, tracking a weekly decline in iron ore prices.
A economists expect the Brazilian central bank to leave interest rates unchanged for a second time in a row next week as a wave of currency instability deepens policymaker concerns over the trajectory of consumer prices.
Mexico's peso held steady at 18.45 per dollar, thoughit was headed for a second consecutive weekly decline.
Chile's peso was flat at 949.39 per dollar. The country's central bank is expected to hold its benchmark interest rate at 5.75% at its monetary policy meeting next week, a .
Bucking the trend, Colombia's peso rose 0.3%, while Peru's sol also strengthened 0.8%.
Meanwhile, the dollar was subdued after data showed moderate increases in the personal consumption expenditures price index in June, underscoring an that could position the Federal Reserve to begin cutting interest rates in September.
"The Fed and the market are still getting what they need to keep the Fed on a path to a first cut to their policy rate in September and a 'soft landing' being the most likely economic outcome," said Greg Wilensky, head of U.S. fixed income at Janus Henderson Investors, referring to a scenario in which inflation is tamed without triggering a painful recession or sharp rise in unemployment.
An easing of U.S. interest rates is generally viewed as a positive for emerging markets, where interest rates are broadly higher, increasing the appeal for "carry trades."
On the equities front, Brazil's Bovespa index added 1.3%, with Vale rising 1.7% after the mining giant said its was triple that of the year-earlier period, beating analyst estimates, as sales jumped.
Usiminas tanked 23.2% after the steelmaker reported a loss in the second quarter and was .
A broader index tracking regional bourses was up 0.4%, though set for its biggest weekly decline of about 3%.
Indexes in Mexico and Colombia fell 0.3% and 0.4%, respectively.
Attention this weekend will be on in oil-producing Venezuela.
HIGHLIGHTS
** hope pre-election recruitment drive will pay off
** says output falls 8% in first half of 2024
Key Latin American stock indexes and currencies:
(Reporting by Johann M Cherian and Shashwat Chauhan in Bengaluru; Editing by Emelia Sithole-Matarise and Paul Simao)
((johann.mcherian@thomsonreuters.com [johann.mcherian@thomsonreuters.com]; Shashwat.Chauhan@thomsonreuters.com [Shashwat.Chauhan@thomsonreuters.com]))
