EM LATAM CREDIT: ENAP/Argentina: Vaca Muerta Oil - Positive

• Deficit-to-GDP ratio projected to fall to 1.5% in 2029 from 2.5% in 2025.
• Federal debt-to-GDP 42.4% in 2025; expected to rise to 43.1% over next 5-year horizon. Liberals had pledged to lower this ratio over time.
• US trade war is a main drag on fiscal position as well as new spending.
• Immigration: Permanent resident targets to stabilize at 380,000, -15k from 2025, annually for three years. Temporary resident targets to fall from 673,650 in 2025 to 385,000 in 2026, and 370,000 in 2027 and 2028.
• Public service jobs to decline by about 40k, or 10%, by the end of 2028-29.
• Finance Minister Champagne says Canada using its "fiscal firepower" to fight against U.S. trade war, and the fiscal plan can win needed support from some opposition lawmakers to pass the budget and avoid a snap election.
• Private economist survey used in budget saw BOC rate unchanged through next year at 2.25%.

• CANADA 2025-26 DEFICIT CAD78.3B OR 2.5% GDP VS PRIOR CAD42.2B
• 2026-27 DEFICIT RAISED TO CAD65.4B, 2% OF GDP, FROM CAD31B
• BUDGET ADDS CAD167B OF EXTRA DEFICITS OVER FIVE YEARS
• CHAMPAGNE DROPS LOWERING DEBT TO GDP AS A FISCAL ANCHOR
• CANADA DEBT RISES FROM 41.2% OF GDP IN 2024 TO 43.1% IN 2029
• DEFICIT TO GDP DECLINES FROM 2.5% IN 2025 TO 1.5% IN 2029
• CANADA ADDING ABOUT CAD30B OF NEW MEASURES THIS YEAR AND NEXT
• CANADA SEES BORROWING CAD614B IN FISCAL 2025, CAD594B IN 2026
• CANADA MORTGAGE BONDS LIMIT RISING TO CAD80B FROM CAD60B

The AUD/USD had a range overnight of 0.6481-0.6520, Asia is trading around 0.6490. The risk backdrop has started showing signs of exhaustion and this has helped the USD continue its march higher. The AUD/USD traded heavy as risk turned lower, this together with the market looking for more hawkish overtones from the RBA has seen the pair move below 0.6500. First support is now towards 0.6450 and then the more important 0.6350 area. The USD is starting to gain real momentum and the AUD has lagged this move helping it outperform in the crosses, should those support areas give way it could play catch up to the wider move. 

• MNI RBA WATCH: Bullock Strikes Cautious Tone Following Pause. The Reserve Bank of Australia may not need to ease as much as its peers, Governor Michele Bullock said on Tuesday after the Board unanimously decided to hold the cash rate at 3.6%.
• Bullock said the economy had probably retained more demand than previously expected, which continued to drive inflation, particularly in market services and new-dwelling costs.
• Monetary policy remains tight despite mixed signals on financial conditions, she reiterated. The data going forward will now obviously be key.
• Options : Closest significant option expiries for NY cut, based on DTCC data: 0.6700(AUD 462m). Upcoming Close Strikes : 0.6500(AUD971m Nov 7), 0.6600(AUD560m Nov 6), 0.6600(AUD682m Nov 7) - BBG
• Data/Event: S&P Global Australia PMI’s 

Fig 1: AUD/USD spot Daily Chart

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