EM LATAM CREDIT: LATAM Credit Market Wrap

• Treasury futures are extending lows now, curves bear flattening as projected rate cuts into year end continue to cool.
• Futures extending past this morning's ADP/GDP/Core-PCE lows: Sep'25 10Y futures currently trades -12 at 110-31.5 (110-31 low, 111-14.5 high). Key support is 110-08+, the Jul 14 and 16 low. Clearance of this level would reinstate a bearish theme. First support is at 110-19+, the Jul 24 low.
• Curves shift to flatter: 2s10s -1.814 at 43.131, 5s30s -1.397 at 94.131.
• Cross asset: Stocks retreating (SPX eminis -26.0 at 6380.25), Gold weaker at 3279.0, Bbg US$ index remains bid: 1218.77 (+8.79).

Powell's commentary today on tariff passthrough to inflation continues to suggest a fairly extended timeline to achieve clarity: 

• "What we see now is basically the very beginnings of whatever the effects turn out to be on goods inflation. And you know, I'll say again, they may be less than than people estimate, or more than people estimate. They're not going to be zero."
• And yet, "Inflation, we were very close to 2%. We're seeing some goods inflation move us away, but so far, not very far away."

• RES 4: 1.1923 2.000 proj of the Feb 28 - Mar 18 - 27 price swing
• RES 3: 1.1851 High Sep 10 2021
• RES 2: 1.1789/1829 High Jul 24 / 01 and the bull trigger 
• RES 1: 1.1663 20-day EMA 
• PRICE: 1.1455 @ 19:48 BST Jul 30
• SUP 1: 1.1454 Low Jul 30
• SUP 2: 1.1431 23.6% retracement of the Feb 3 - Jul 1 bull cycle
• SUP 3: 1.1373 Low Jun 10
• SUP 4: 1.1313 Low May 30  

EURUSD maintains a softer tone and traded lower again Wednesday. This week’s bearish price action has resulted in a move through key support at the 50-day EMA, at 1.1560. A clear break of this EMA would highlight a stronger reversal and the start of a correction. Scope is seen for a move towards 1.1431, a Fibonacci retracement. Note that medium-term trend indicators continue to highlight an uptrend. The bull trigger is 1.1829, the Jul 1 high.