NY Open – President Trump and the Order of Tariffs By Varshi Karamsetty Tariff risks are back after multiple developments overnight. After the Senate confirmed Scott Bessent as the next Treasury Secretary, FT reported that Bessent was backing gradual 2.5% universal tariffs (including a monthly increase) citing people familiar. President Trump said he wants universal tariffs ‘much bigger’ than 2.5%,…
US tariffs on Colombia are held ‘in reserve’ and not signed, says the White House, as Colombia has agreed to Trump terms. Visa sanctions on Colombia are to remain in effect. Markets slightly pull back some of the initial moves seen post the announcements. MXN is now down 0.7% (vs about -1%) earlier Go deeper: The Colombian government has agreed to all…
CitiFX Wire Market Commentary – FXLM – Intended for Institutional clients only NY Open – Recalibrate By Varshi Karamsetty USD traded softer overnight after markets reduce short-term tariff risks. While President Trump said that China “could” face a 10% tariff, alongside 25% tariffs in Mexico and Canada on February 1, the risks of “universal tariffs” should be pared back by…
NY Open – All ears By Varshi Karamsetty US yields recovered slightly overnight, with US 2y yields retracing towards 4.28%, US equity futures drift higher and DXY index trades flat. Overnight, AUD labor data came strong but with focus on Q4 CPI, market reaction was tepid. A Feb cut remains the bias (-17bps priced). KRW saw a knee-jerk rally after…
Initiating long USDCOP: Our MarFA Macro model indicates that the pair is 1.7 z-scores (2.6%) undervalued versus its MarFA fair value of 4431.4 (Figure 1) as spot has declined over the past couple of weeks while fair value has remained supported. Our Global FX Positioning tracker implies COP positioning is lightly short at a score of -7 (+/- 50 scale),…
NY Open – Adjustment into the weekend By Varshi Karamsetty In Asia, Chinese stocks fell after the CEWC disappointed – the lack of policy details and concrete measures, and no plans of US tariffs means there will be a policy vacuum until the NPC next March. As we print, French President Macron has announced historical centrist Bayrou as the new…
Spot USDCOP ended down at the lows yday at 4345 on a larger volume day. Our flows were again largely systematic USD selling in more constant of clips, which is what we saw Monday as well before taking a pause on Tuesday. This flow did eventually overwhelm the market as dealers scrambled to cover residual long USD positions before…
South Korea political dust somewhat settles overnight with lawmakers successfully lift the martial law placed by President Yoon. The focus now turns to his impeachment, which the process has begun already. KOSPI still closed -1.4%, though KRW spot stabilized. Elsewhere, sharp move lower in AUD after GDP missed. A full RBA cut is now priced in for April 2025, though…