Latin America hammered by crisis

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SAO PAULO, Oct 11 (AFP): Brazil, Argentina, Mexico and other Latin American economies are being hammered by the global financial crisis, with battered stocks and currencies hitting multi-year lows.
Friday saw the region's major equity indices deepen week-long losses.
Latin America's biggest stock market, in the Brazilian city of Sao Paulo, closed down 3.97 per cent at 35,609 points, its lowest level in over two years.
At one point during Friday's session, losses went below 10 per cent, triggering an automatic trading suspension-a very rare occurrence that happened three times this week. The Brazilian currency, the real, has also tumbled, losing a third of its value in the past two months. On Friday it was trading at 2.33 to the dollar.
Mexico's bourse also closed lower, the BMV index down 1.99 per cent at 404.93 points after a volatile day.
But much focus was on the Mexican peso, which is now languishing at a record low 13.29 to the dollar, despite 9.3 billion dollars being pumped into the market by the desperate central bank.
Argentina's fragile economy was reeling from repeated losses on the share market. On Friday, the Merval index lost another 5.54 per cent to close at 1,215.99 points. During the session, it had shown a 10-per cent decline.
The unremitting wash of red ink confirmed that foreign investors were fleeing emerging markets, both because of the risk and because many were forced to cover losses at home.
While the currency devaluations across Latin America vis-a-vis the dollar would normally raise exporters' hopes of selling more, the fact that the region mostly sells commodities, whose prices are also plummeting, and that the global slowdown will throttle demand has thrown gloom everywhere.
"New (export) business has come to a halt" because companies do not know what exchange rate to apply, the head of the Exporters' Association of Brazil, Jose Augusto de Castro, said.
Brazil's government appealed for calm, saying its national economy had strong fundamentals-in terms of dollar reserves, inflation control and fiscal policies-that should counter the "panic" being seen on its equity and currency markets.
"Yes, we are concerned," the presidential chief of staff, Dilma Rousseff, told reporters. "But we have to keep calm and we have to have the most realistic perspective possible."