ARGENTINA: Analysts Sceptical Over Proposed FX Measures
Jul-22 11:50
- Argentina limited access to the official foreign exchange market for companies trading shares of US-based companies on the local market, according to an emailed central bank statement following a meeting of the board of directors. (Bloomberg)
- The central bank said companies may hold up to $100,000 in the securities, known locally as Cedears.
- Companies may not trade the instruments for 90 days before or after accessing the official foreign exchange market.
- Analysts have noted that the government’s resistance to a broad currency realignment is driven by the massive effect a depreciation of the peso would have on public debt dynamics -- of which nearly 70% is denominated or linked to foreign currencies.
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NORGES BANK: Bank Likely to Retain 25bps Hike Pace
Jun-22 11:42
- Tighter policy has been well signposted for the June meeting, with the bank signalling a rate hike is “most likely” to be delivered. The size of the hike is less forecastable. Markets have fully priced a 25bps rate rise to 1.00% - and partially a 50bps rise – leaving markets at risk of a ‘dovish’ disappointment from a mere 25bps hike.
- While inflationary pressures, rates among trade partners and firm oil prices argue in favour of a more sizeable 50bps hike this month, the board are likely to stick to their predictable, steady, “gradual” 25bps due to a unique transmission mechanism and a firm preference for credibility-driven policy.
- To counter any ‘dovish’ messages of a 25bps hike this week, the board will likely steepen their path projections further this quarter, introducing – for the first time this cycle – the likelihood of rate hikes at inter-policy report meetings. The bank could reinforce this message by stating that the next rate hike “will likely” follow in August.
- Full preview featuring summary of sell-side views here: https://marketnews.com/mni-norges-bank-preview-jun...
MNI EXCLUSIVE: UK inflation
Jun-22 11:42
- MNI interviews the chief economist at the UK's office for national statistics about inflation
- On MNI Policy MainWire now, for more details please contact sales@marketnews.com
MARKET INSIGHT: What to Watch: Lower Tsy Ylds, Oil and Stocks Ahead Fed Powell
Jun-22 11:38
Tsy futures trading broadly higher back near pre-FOMC levels, global growth concerns spurring risk-off bid for rates. Oil bid evaporates, WTI -5.0 at 104.52 -- Pres Biden speaking at 1400ET is expected to ask Congress to suspend Federal fuel tax for three months.
- Economic data, limited to MBA Mortgage applications: 4.2% vs. 6.6% prior; refis -3%; 30Y conforming mortgage rate 5.98% vs. 5.65% prior -- highest since 2008.
- Fed speakers, focus on Chairman Powell Senate testimony:
- Richmond Fed Barkin, West Virginia CoC virtual event at 0900ET
- Fed Chair Powell semi-annual Senate panel testimony, 0930ET
- Richmond Fed Barkin speaks w/ Federal City Council, 1200ET
- Chicago Fed Evans economic Outlook, 1250ET
- Philly Fed Harker, Richmond Fed Barkin outlook, no text, Q&A, 1330ET
- Tsy auctions:
- US Tsy $30B 119D bill CMB, $22B 2Y FRN note (91282CEL1), 1130ET
- US Tsy $14B 20Y Bond auction re-open (912810TH1), 1300ET
- Geopol: China's Pres Xi at BRICS Business Forum: calls for "joint efforts to seek and safeguard peace. History has shown that hegemony, group politics and bloc confrontations bring neither peace nor stability, but rather war and conflict." Adds "China will continue to improve the level of opening up to the outside world, and warmly welcomes foreign investment to share development opportunities."
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