COP – COP flows have seen interest to sell dollars mostly from fast money clients. Our traders are also seeing clients beginning to sell forward points as USDCOP continues its trend downward breaking the 4200 level that it has been hovering around for the majority of October. Industrial confidence also dipped in September, while retail confidence made a recovery. Next level to watch will be 4100 as dollar selling has accelerated over the past day.
NY Open – Boo-ring
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As we head into the weekend, risk sentiment is buoyed, overnight moves modest. Equities traded well, after positive US earnings spilled over into Asia, while high-betas like AUD, MXN and ZAR the biggest beneficiaries in FX. USTs are broadly unchanged, while USDJPY held above 150, following familiar verbal intervention from FinMin Suzuki, and Tokyo CPI beat. Citi Economics now expect YCC readjustments next week. An early release of state-level Germany CPI points to big drops in inflation data next week, though market reaction was modest – EURUSD unchanged at 1.056. US Core PCE is the main event for the day at 08:30 – our economists still expect a 0.28% MoM print despite a softer QoQ number, the latter could see downsides in the 3.7% YoY estimate. Otherwise, EM catalysts are light. Chile central bank only cut benchmark rates by 50bps on Thursday (consensus 75bps) and two other measures to support CLP. CLP local markets are closed, though expect stronger activity on the NDF side. |