Latin American currencies sink to 22-year low as stocks tumble

By Jill Replogle

SÃO PAULO — Latin American currencies slid to a 22-year low and stocks joined a global selloff Monday on speculation that the region’s economic contraction will deepen as Chinese growth slows down.

The Bloomberg JP Morgan Latin America Currency Index sank to the lowest since at least November 1992 as Colombia’s peso fell the most since 2008. The MSCI gauge for the region’s shares fell 4.1 percent, led by Brazilian miner Vale and oil producer Petroleo Brasileiro.

More than half of the companies in the Ibovespa, which is in a bear market, have dropped to at least one-year lows in the past week. Mexico’s peso weakened to a record, and the nation’s shares are at a so-called technical correction after plunging more than 10 percent from their September peak.

“It is a bloodbath,” said Bernd Berg, a London-based strategist at Societe Generale. “We see panic selling due to global growth fears and uncertainty about the next Fed move.”

Stocks and currencies in developing nations have plummeted amid a rout in global markets spurred by concern that Chinese growth is slowing faster than expected just as the Federal Reserve prepares to increase interest rates. Corruption scandals from Brazil to Mexico and a collapse … continue reading

Via:: Tico Times