EM LATAM CREDIT: Colombia (COLOM): Downgraded by Fitch

Earlier monthly price data for Oct has seen Westpac revise down its Q4 inflation forecast, see below for more detail. Food prices fell 0.3%m/m, after falling 0.4% in Sep. This bought the y/y pace to 4.7%, up from Sep's 4.1% pace, but we have stabilized under 5% in recent months. Westpac cites softer travel and rental for its forecast revision. Note that on Wednesday this week we get Q3 PPI, although this tends not to shift market thinking too much. Note that Q4 CPI in NZ prints on Jan 23 next year. 

Westpac: "We’ve revised our forecast for December quarter inflation to +0.3% and +2.8% for the year to December. Those estimates are both down 0.1ppts from our earlier forecast.  Our updated forecast reflects information from Stats NZ’s monthly selected prices update. That update showed greater than expected softness in travel costs, which can be volatile on a month-to-month basis and will warrant close attention over the coming months. However, we also saw softness in other areas. Most notably, rental inflation has been very weak. Our updated forecast is close to the RBNZ’s last published forecast from their August MPS for a 0.3% quarterly rise, and 2.7% annual inflation. " 

• Note, RBNZ dated OIS pricing is little changed across meetings, post this morning's data (we also had the services PMI, which rose but remain sub 50). 25bps of easing is priced for November, with a cumulative 34bps by February 2026.

• MNI JAPAN Q3 REAL GDP -0.4% Q/Q; MNI MEDIAN -0.7%
• JAPAN Q3 REAL GDP -1.8% ANNUALIZED; MNI MEDIAN -2.7%
• JAPAN Q3 GDP POSTS 1ST CONTRACTION IN 6 QUARTERS

Bitcoin had a range over the weekend of $94 049.72k - $96 741.73k, Asia is currently trading around $94 300k, +1.00%. Bitcoin has remained under pressure over the weekend, and has broken through $94k on the Asian open making a low of $92 935.50. Technically this is starting to look really poor now, there are lots of commentators saying this will be the low, but in my experience when you have a leveraged asset class it tends to squeeze out weaker hands and inflict maximum pain before it finds a base again. We are entering its support between $90k-$95k and risk reward still favours a short-term fade but a break below here would potentially signal a deeper correction is underway, this scenario would make a few of those treasury companies holding bitcoin on their balance sheet nervous and target levels back toward $75k. Look for rallies toward $100-$105K to find sellers again initially in the short-term.

• Bitcoin’s Average True Range for the last 10 Trading days: 3 706 Points
• Pegasus on X was not a believer, “Everyone thinks bitcoin is a safe inflation hedge on the way up. No one wants to hold it on the way down. I don’t care what anyone tells you. Internet money up 30x in 5 years is not an inflation hedge. It is a Ponzi scheme being cornered by over-leveraged players.”
• Michael Saylor of Strategy the huge bitcoin treasury company says: "Even if $BTC hits $1, I won’t get liquidated, we will just buy it all" Bitcoin." https://x.com/cryptosymbiiote/status/1989800583805772282?s=20
• Having issued convertible bonds and high-yield notes as well as raising capital by selling new equity through preferred stock to buy a huge part of his Bitcoin, the question is at what point do they receive margin calls ? Michael Saylor appears to think that's never going to happen and they can just keep buying but I am pretty sure he would be getting some calls in the event the price moves back toward his average price of  $74 000 on the 641,692 Bitcoin his company currently holds if not before.

Fig 1: Bitcoin spot Daily Chart

Source: MNI - Market News/Bloomberg Finance L.P