NY Open – Definitely maybe
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Markets are in a holding pattern in between catalysts, with a lack of catalysts overnight. European FI traded heavier, weighing on US Treasuries though other US assets trade flattish. USDJPY breached 145 overnight with Asia FX underperforming slightly. The post-Jackson Hole macro consensus is ultimately intact. Second tier US data includes Case-Shiller home price index at 09:00 EDT, Conference Board consumer confidence at 10:00 and regional Fed prints. BRL IPCA inflation at 08:00 EDT could decelerate MoM, CLP awaits lower house pension bill approval later today. Our economists expect a 25bp rate cut from NBH today, but market pricing implies risk of another hold. |
Trader Take – USDCOP Open August 27
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USDCOP traded on a tight range yesterday as we saw mixed RM flows during the session and some corporate outflows. Overall, it was another session with lower activity from client and lower interbank volumes, which could also be explained by the London holiday. 1 month forward points traded lower towards 18bps basis while the rest of tenors continue to be around 50bps in the short end and 90bps in the long end. We saw some interest to buy 3month pts while there is still some interest to sell the longer end. With the absence of local news, I expect to continue seeing USDCOP trade around 4,030 level which is the strongest resistance currently. Given the time of the month, we should see some Corp outflows during this week. I am watching 4,030 as resistance and 4,000 as support. |
