* Rouble set for decline of over 30% on the week
* Oil-rich Colombia's peso set for best week in 6 months
(Updates prices)
By Shreyashi Sanyal, Anisha Sircar and Bansari Mayur Kamdar
March 4 (Reuters) - Emerging market currencies were near
five-month lows on Friday, with Russia's rouble at a never been
hit 120 a dollar in offshore trade, while developing world
stocks hit a 16-month trough as war in Ukraine raged on.
Russia's seizure of Europe's biggest nuclear power plant in
Ukraine roiled global financial markets and sparked fears of a
potential nuclear disaster.
The MSCI's index for emerging market currencies
eyed its worst weekly performance in almost two
years, down months 1.5%. Its stocks counterpart
dropped 2.5% on Friday and was on course for its third straight
week in the red.
Russia's rouble was set to wrap its worst weekly
decline since 1998, down about 35%. In Moscow, the currency
closed at 105 per dollar after hitting a record
low of 118.35 on Thursday.
"Russian assets are being destroyed in value," said Cristian
Maggio, head of portfolio strategy at TD Securities.
Given their proximity to the conflict, emerging European
currencies were hammered, with Hungary's forint
posting its worst weekly performance since 1994, down 5.4%.
As Russia is one of the world's biggest exporters of key raw
materials, the possible exclusion of supplies from the country
as stinging Western sanctions take hold sent commodity market
rallying this week.
Crude oil hit its highest price in a decade and copper
surged. Taking advantage were currencies in resource-rich Latin
America.
Even as most currencies in the region fell sharply on
Friday, solid gains through the week put oil exporter Brazil's
real and Colombia's peso on track to end
the week higher, with the latter eying its best weekly gains in
six months, up more than 2%.
"The surge in prices of commodities exported by Russia and
Ukraine is distorting the inflation outlook for (Latam)," said
Joan Domene, senior economist at Oxford Economics in Mexico.
"Market reactions across Latin America have been mixed again
this week, as rising inflation expectations were offset by the
likely benefits of higher-for-longer commodity prices."
A Reuters poll showed that Latam currencies are set to
remain steady in the near term as traders focus on comparatively
moderate tightening from the U.S. Federal Reserve and an
unusually quiet spell in Brazil's politics, rather than Russia's
invasion of Ukraine.
Data showed Brazil's economy returned to growth in the
fourth quarter, exiting a mild recession at a stronger pace than
expected as farm output surprised.
In Argentina, sovereign bonds fell an average 1.5% on Friday
despite the government striking a $45 billion staff-level
agreement with the International Monetary Fund, a painful
reminder that investors remain wary of the country's economic
outlook.
Key Latin American stock indexes and currencies at 1907 GMT:
Stock indexes Latest Daily %
change
MSCI Emerging Markets 1143.27 -2.5
MSCI LatAm 2421.52 -1.58
Brazil Bovespa 113961.10 -1.05
Mexico IPC 52988.52 -1.01
Chile IPSA 4641.75 1.53
Argentina MerVal 89371.74 -2.388
Colombia COLCAP 1533.94 -0.03
Currencies Latest Daily %
change
Brazil real 5.0835 -1.13
Mexico peso 20.8980 -1.27
Chile peso 809.7 -1.78
Colombia peso 3826.01 -1.84
Peru sol 3.755 -0.69
Argentina peso 108.1300 -0.08
(interbank)
(Reporting by Shreyashi Sanyal, Anisha Sircar, Bansari Mayur
Kamdar, Susan Mathew in Bengaluru; editing by Jonathan Oatis and
Sandra Maler)
Dolores Redondo es colaboradora en El Demócrata, donde cubre una amplia variedad de temas, incluyendo actualidad, política, negocios, tecnología, deportes, entretenimiento y estilo de vida. Se enfoca en brindar información clara y útil sobre los acontecimientos del momento, ofreciendo a los lectores historias relevantes y perspectivas accesibles sobre temas de interés general.