COP – In COP, we had inflows from RM in cash and some outflows from Corp. Spot has lacked direction and continues to remain in the 3950-4050 range, keeping in mind seasonality turns rather negative for the currency in December. Locally yesterday a new ESG government auction was announced for COP 650TN to be held this Thursday. 60% of this bond is held by offshore investors. so the auction could be translated into new inflows.
Post-FOMC reactions continue, with USTs extending their rally and USD pushing weaker, high-betas and JPY the biggest beneficiaries. USDJPY has broken below the 200dMA, trading towards 141, which currently offers strong support. FX interbank volumes in the London session were higher by 40% compared to the last 30d average – CHF and NOK seeing the most action after rate decisions. A surprise 25bps hike by Norges saw NOK extend +2%, while dovish signals from SNB saw CHF lag peers. SEK inflation missed expectations, providing further fuel for NOKSEK upside.
2 more central bank decisions to come: BoE first at 07:00 EST – vote split is most interesting. Slightly hawkish would be a 6-3 hold, but risks skew dovish. For the ECB at 08:15 EST, watch out for a PEPP reinvestment announcement. Lagarde may struggle to deliver sufficient dovish language, suggesting upside EURUSD risks. Trends should hold in both US jobless claims and retail sales at 08:30. MXN expect no changes at the Banxico meeting at 14:00 EST, while PEN sees a 25bps cut at 18:00. BRL awaits retail sales.