COP – COP is the top performer in the Latam complex today. We are seeing cash outflows on the back of offshore accounts selling Coltes. This has pushed forward points lower and we are starting to see more buying interest from offshore accounts in NDF.

NY Open – Cold comfort

Signs of reprieve for risk assets overnight are cold comfort. Treasuries have firmed after failing to break key technical levels on Thursday. USDJPY has snapped back to 145.45, following US yields lower. However, the trends of this week remain intact. VIX is at the highest level since May, with no interest to buy the dip in US equity futures. We suspect that the Treasury rally will run out of steam, limiting USD losses. Our eTrading platform saw USD buying from investor names over the London morning though admittedly volumes were 20% below the 30d average.

The PBoC CNY fix sent another signal of authorities’ discomfort with the pace of depreciation. UK retail sales broke the trend of recent data beats, but we like buying the dip in GBP given sticky MPC pricing. With no catalysts on the calendar today, expect summer market consolidation to dominate. We wait for the full Jackson Hole agenda. MXN will look through political noise and in line retail sales, while CLP sees the release of Q2 GDP.