MEXICO: Lower House Approves Bill Banning GMO Corn, USDMXN Rangebound
Feb-26 11:59
- USDMXN has continued to trade in a tight range around 20.45 ahead of the NY crossover, as the market awaits developments on the tariff front. Yesterday, President Sheinbaum said that she aims to close a tariff deal with the US by next Tuesday, although she doesn’t yet have a date set for a call with President Trump. For USDMXN, initial resistance is at 20.7132, the Feb 5 high, while key support remains at 20.1343, the Jan 24 low.
- Yesterday, the lower house approved a bill backed by President Sheinbaum banning GMO corn crops. The bill was approved with 409 votes in favour and 69 against. Separately, the Senate approved a bill to end the re-election of any public office as well as a bill restricting when someone could take the same office as a family member. The Senate approved the two bills in general terms and non-reserved articles.
- The macro calendar is light today, with January trade figures and unemployment data due tomorrow. Meanwhile, President Sheinbaum will hold her usual press conference from 1330GMT(0830ET).
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EGBS: 10-year RAGBs Underperform Semi-core Peers Following Syndication Mandate
Jan-27 11:59
The 10-year RAGB/Bund spread has widened ~2bps since this morning’s dual-tranche syndication mandate, now at 37bps. This leaves 10-year RAGBs underperforming semi-core peers (Netherlands, Ireland, Belgium, Portugal and France) intraday.
- The timing of Austria’s first syndication had been uncertain due to questions surrounding the budget outlook. MNI had looked for a transaction this week or in the first half of February – with a lean towards the latter.
- A new 10-year Feb-25 RAGB maturing 20 February 2035 will be launched alongside a tap of the 1.85% May-49 Green RAGB – in line with MNI’s expectations.
- A reminder that the EU decided not to proceed with an Excessive Debt Procedure on Austria earlier this month, after negotiators attempting to form a right-wing coalition presented a E6.4bln savings plan.
- On Jan 10, Fitch revised Austria’s outlook to Negative from Stable (rating affirmed at AA+).
- As of Q3 ‘24, the 4Q rolling sum of the budget balance was -3.7% of GDP (vs -3.3% in Q2). Both Bloomberg analysts and the EC expect the 2024 budget balance to print at -3.6% of GDP, down from -2.6% in 2023.
CROSS ASSET: MONTH END EXTENSION (update)
Jan-27 11:58
Looking at the UK, this looks to be a record Extension for the Month of January at least for Bloomberg (Used to be Barclays).
Bloomberg Bonds projected:
- US Tsys: +0.07yr (small, average).
- EU Govies: +0.10yr (decent).
- UK Govies: +0.23yr (HUGE).
MS Bonds:
- US Tsys: +0.05yr (small).
- EU Govies: +0.07yr (small, average).
- UK Govies: +0.17yr (LARGE).
OUTLOOK: Price Signal Summary - Gold Bulls Remain In The Driver's Seat
Jan-27 11:54
- On the commodity front, a bull cycle in Gold remains in play and the recent breach of resistance at 2726.2, the Dec 12 high, reinforces current conditions. Sights are on $2790.1, the Oct 31 all-time high. A break of this hurdle would confirm a resumption of the primary uptrend. On the downside, the first key support to watch is $2668.8, the 50-day EMA. A reversal lower and a breach of this average would reinstate a bearish threat. The 20-day EMA is at $2698.2.
- In the oil space, the trend structure in WTI futures is bullish despite the recent pullback. The move down appears corrective and is allowing an overbought trend reading to unwind. The 20-day EMA, at $74.28, has been pierced. A clear break of it would signal scope for a deeper retracement and expose the 50-day EMA, at $72.11. A reversal higher would highlight the end of the correction and refocus attention on $79.48, the Apr 12 ‘24 high and a key resistance.
