CHILE: Chile Considers a Hike in the Minimum Wage

• March FOMC minutes notes officials saw risks to inflation and unemployment tilted to the upside amid elevated policy uncertainty, a combination that could lead to "difficult tradeoffs"
• "Participants assessed that uncertainty around the economic outlook had increased, with almost all participants viewing risks to inflation as tilted to the upside and risks to employment as tilted to the downside. Participants remarked that monetary policy was well positioned to address future developments; a restrictive policy could be maintained for longer if inflation were to remain elevated, and policy could be eased if labor market conditions were to deteriorate or economic activity were to weaken."
• Some officials noted the FOMC "may face difficult tradeoffs if inflation proved to be more persistent while the outlook for growth and employment weakened, and several said elevated inflation could prove to be more persistent than expected, the minutes said.
• On the decision to slow QT, only Governor Waller dissented but "several participants did not see a compelling case for slowing the pace of runoff at this meeting." 

• RES 4: 0.8715 The Dec 28 ‘23 high       
• RES 3: 0.8700 Round number resistance  
• RES 2: 0.8683 1.764 proj of the Mar 3 - 11 - 28 price swing
• RES 1: 0.8663 High Apr 09
• PRICE: 0.8649 @ 15:37 BST Apr 9 
• SUP 1: 0.8470/0.8415 Low Apr 7 / 20-day EMA 
• SUP 2: 0.8377 50-day EMA
• SUP 3: 0.8316 Low Mar 28 and a key near-term support   
• SUP 4: 0.8299 Low Mar 5

EURGBP continues to appreciate as the impulsive bull rally accelerates further. A key resistance at 0.8625, the Aug 8 ‘24 high, has been cleared. The breach highlights another important technical break and strengthens a bullish condition. Sights are 0.8683 next, a Fibonacci projection. Firm support lies at 0.8415, the 20-day EMA. Note that the cross is in extreme overbought territory, a pullback would allow this condition to unwind.      

• With question marks over whether the EU is included or not in the Trump’s 90-day pause and lower reciprocal rate of 10% after today’s retaliation (but with first effective not until Apr 15), we note that ERM5 has slid ~9.5 ticks since Trump’s post vs an 18 tick drop for SFRM5 (albeit having rallied into the news).
• There has since been increasingly large underperformance in US rates but with little further change in Euribor futures.
• SOFR implied yields are currently as much as 26bp higher on the day in mid-2026 contracts, dragging CORRA futures for example with them (22bps) whereas Euribor yields are stuck around 8-9bp.
• It is however ambiguous with further clarification awaited.