EM LATAM CREDIT: MNI EM Credit Market Wrap - LATAM (22 Apr)
Source: BBG
Measure Level Δ DoD
5yr UST 3.98% +1bp
10yr UST 4.39% -2bp
5s-10s UST 40.9 -2bp
WTI Crude 64.3 +1.2
Gold 3371 -52.7
Bonds (CBBT) Z-Sprd Δ DoD
ARGENT 3 1/2 07/09/41 890bp -39bp
BRAZIL 6 1/8 03/15/34 291bp -7bp
BRAZIL 7 1/8 05/13/54 386bp -6bp
COLOM 8 11/14/35 471bp -8bp
COLOM 8 3/8 11/07/54 551bp -9bp
ELSALV 7.65 06/15/35 496bp -3bp
MEX 6 7/8 05/13/37 301bp -7bp
MEX 7 3/8 05/13/55 364bp -4bp
CHILE 5.65 01/13/37 173bp -7bp
PANAMA 6.4 02/14/35 363bp -4bp
CSNABZ 5 7/8 04/08/32 694bp -19bp
MRFGBZ 3.95 01/29/31 357bp -6bp
PEMEX 7.69 01/23/50 727bp -12bp
CDEL 6.33 01/13/35 238bp -2bp
SUZANO 3 1/8 01/15/32 240bp -8bp
FX Level Δ DoD
USDBRL 5.72 -0.08
USDCLP 942.50 -19.17
USDMXN 19.6 -0.09
USDCOP 4294.98 +13.86
USDPEN 3.70 -0.01
CDS Level Δ DoD
Mexico 151 1
Brazil 200 (1)
Colombia 286 (0)
Chile 80 0
CDX EM 95.22 (0.08)
CDX EM IG 99.92 0.05
CDX EM HY 90.63 0.19
Main stories recap:
· Global equity prices rose while U.S. equities recovered most of yesterday’s losses on optimism about a tariff deal with Japan and India.
· The U.S. Treasury curve flattened with front end yields rising 3-5bps as it absorbed a solid USD69bn 2 years note auction while longer maturities recovered 2-3bps from yesterday’s sell off.
· LATAM benchmark corporate and sovereign bond spreads tightened across the board. Low beta higher quality sovereign bonds like Chile and Peru tightened about 5 bps.
· Oil prices bounced almost 2%, helping Colombia and Pemex outperform with those spreads tightening 8-11bps. Argentina bonds rose more than a point.
· Brazil corporate bonds were about 5-10bps tighter while cyclical names like CSN did even better with bonds moving 15-20 bps tighter.
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Historical bullets
CANADA PM CARNEY TO MEET GOVERNOR GENERAL AT NOON
- CANADA PM CARNEY TO MEET GOVERNOR GENERAL AT NOON
- CARNEY EXPECTED TO SEEK ELECTION
US TSYS: Available "Extraordinary Measures" Pick Up Slightly From Lows
Treasury has $163B of "extraordinary measures" remaining for authorities to use to fend off hitting the debt limit as of March 19, per the latest release of Treasury data. That's up from $86B on Mar 17 and a low of $34B on Feb 24.
- That's a little under half of the $377B in measures available to Treasury, with most of the amount remaining ($143B) coming from the so-called "G Fund".
- This headroom is in addition to $416B in cash left in the TGA, at last count.
- We haven't seen any changes recently to "x-dates" by when Treasury will run out of cash until the debt limit is lifted.
- Consensus still centers around late July/early August, but much will depend on April's major mid-month tax take. Treasury wrote to Congress last week that they would be able to provide an update on the x-date in the first half of May, after the conclusion of tax season.
USDCAD TECHS: Short-Term Outlook Remains Bullish
- RES 4: 1.4793 High Feb 3 and key resistance
- RES 3: 1.4700 Round number resistance
- RES 2: 1.4641 76.4% retracement of the Feb 3 - 14 bear leg
- RES 1: 1.4452/4543 High Mar 13 / 4 and a bull trigger
- PRICE: 1.4345 @ 16:27 GMT Mar 21
- SUP 1: 1.4242 Low Mar 6 and a key near-term support
- SUP 2: 1.4151/4107 Low Feb 14 / 50.0% of Sep 25 - Feb 3 bull run
- SUP 3: 1.4011 Low Dec 5 ‘24
- SUP 4: 1.3944 61.8% retracement of the Sep 25 ‘24 - Feb 3 bull cycle
USDCAD is trading closer to its recent lows. The bull cycle that started Feb 14 remains intact and moving average studies remain in a bull-mode position, highlighting a dominant uptrend. Note that the latest pullback has exposed a near-term key support at 1.4242, the Mar 6 low. Clearance of this level would undermine the bull theme and instead highlight potential for a test of 1.4151, the Feb 14 low and a bear trigger. The bull trigger is 1.4543, the Mar 4 high.
