LONDON, Oct 12 (Reuters) – A push by big technology firms into financial services in developing countries will improve access to them, but might also make traditional lenders more vulnerable, the Financial Stability Board (FSB) said.

The expansion in emerging markets has generally been more rapid and broad-based than that in advanced economies, the FSB, which coordinates financial regulation for the Group of 20 Economies (G20), said in the report released on Monday.

Lower levels of access to traditional banking and financial services developing economies had created demand for services now offered by big tech firms, the report found, particularly among low-income populations and in rural areas.

An increasing availability of mobile phones and internet access supported this trend, the FSB said.

“However the expansion of BigTech activity also gives rise to risks and vulnerabilities,” it said, pointing to lower financial literacy and firms using other data gathered.

“Competition from BigTech firms may, in places, also reduce the profitability and resilience of incumbent financial institutions and lead to greater risk-taking,” the FSB added. ($1 = $1.0000) (Reporting by Karin Strohecker; Editing by Alexander Smith)

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By Shreyashi Sanyal

Oct 9 (Reuters)Most major currencies in Latin American were set to end the week higher on Friday, with Brazil’s real leading gains after economic data through the week showed signs of improvement, while a weaker dollar also offered support.

The real BRBY, BRL= strengthened 1.3%, heading for its first weekly gain in five as data showed a pick-up in Brazil’s services sector last month. Another report showed a record reading on retail sales for August.

Investors, however, worried about Brazil’s public finances after the introduction of a new fiscal bill, called Renda Cidada, fanned fears about the government overshooting its spending limit.

FX analysts at Commerzbank said that given the uncertainty about the pandemic’sprogression and its economic impact, it is unlikely that disagreements about the consolidation of national finances will be resolved soon.

Mexico’s peso MXN= was on track for its second week of gains after the country’s government unveiled an infrastructure investment plan worth nearly $14 billion earlier in the week.

Latam currencies also got a lift from the dollar =USD, which fell to three-week lows on Friday as optimism that a deal for new U.S. stimulus would be reached, and as investors bet that Democrat Joe Biden is more likely to win the U.S. presidency and offer a larger economic package. FRX/

Analysts say a Democratic sweep could also bode well for emerging markets.

“Biden is a much more risk friendly candidate, given his international credentials for multilateralism and predictability and a far less disruptive trade policy,” said Alan Ruskin, macro strategist at Deutsche Bank.

The Colombian peso COP= also headed for weekly gains, getting a boost from rising oil prices. O/R

Chile’s peso CLP= was among the few losers for the week, as it tracked

By Shreyashi Sanyal

Oct 8 (Reuters)The Brazilian real traded lower on Thursday on continued worries about the country’s public finances, although a record reading on retails sales helped limit declines, while other Latin American currencies struggled for direction.

The real BRBY, BRL= edged 0.2% lower, as investors worried about a new fiscal package, known as Renda Cidada, overshooting the government’s spending limit after a volley of mixed information.

“The (Brazilian) government’s intention to create a new social welfare program poses additional risk to the trajectory

of the public accounts,” economists at Credit Suisse noted.

“Despite the government’s decision to revise the proposal after strong backlash, the source of funding for the new program remains uncertain. The main concern is the observance of the spending cap.”

Data from Latin America’s biggest economy provided some support to the currency after Brazilian retail sales rose to their highest on record in August, as economic activity continued to recover from the worst of the nationwide lockdown measures from earlier this year.

Mexico’s peso MXN= was mostly flat in volatile trading. Data showed Mexican inflation cooled to 4.01% in the year through September as consumer prices for energy dropped and food price rises were lower.

A recent Reuters poll showed that Latam currencies are set to remain weighed down this quarter by continuing fears about Brazil’s public finances and Mexico’s close link to U.S. politics before the November presidential vote.

However, Goldman Sachs said lighter investor positioning in emerging markets heading into the U.S. presidential election than before the 2016 vote, suggests “knee-jerk” reactions to the outcome may be contained.

Argentina’s peso ARS=RASL steadied after hitting a record low it hit in the previous session.

The currency was exposed to a fresh bout of selling pressure after the country’s central bank

Volatility in emerging market currencies will not let up in the next six months as U.S. presidential election jitters mount and domestic economic growth tapers off, a Reuters poll of market strategists showed.

Most emerging market currencies were forecast to weaken or at best cling to a range over the next three to six months but will rise about 2% on average in a year, supported by a weaker dollar, the Sept. 28-Oct. 5 poll found.

Reuters surveys since the global shutdown in activity in March have been consistently concluding emerging market currencies will not recoup even half their coronavirus-induced 2020 losses within a year.


Still, a steep dollar selloff, which just posted its worst quarter in three years as expectations for a swift recovery from the COVID-19 recession made investors exit safe havens, has helped currencies in less developed countries rise. That comes despite deep economic troubles from the pandemic.

Volatility in emerging market currencies will not let up in the next six months as U.S. presidential election jitters mount and domestic economic growth tapers off, a Reuters poll of market strategists showed. (iStock)

“EM currencies are running on empty without capital inflows or a resounding macro narrative. The large output gap and lower level of economic activity will have a disproportionately negative impact on currencies,” said Jason Daw, head of emerging markets strategy at Societe Generale.

“EM FX has tended to weaken in the lead up to and for several months after a challenger victory in the contest for the White House. A Democratic sweep, our central scenario, could result in weaker EM currencies.”

A Reuters/Ipsos poll on Sunday found 51% of voters were backing

Video: Goldman’s Swell Sees ‘Enormous’ Demand for U.S. Fixed Income Assets (Bloomberg)

Goldman’s Swell Sees ‘Enormous’ Demand for U.S. Fixed Income Assets



Zambia is running out of money to pay its debts. It has asked bondholders for breathing space so that it can put a restructuring plan in place. The copper-rich African state is at risk of being the first country to default on its debts since the start of the coronavirus pandemic.

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