MEXICO: MXN Continues Strong Performance, US Kerry To Meet With AMLO
Mar-31 11:32
- USDMXN retreated again during Wednesday trade and has delivered a fresh cycle low.
- The trend remains lower and the resumption of the downtrend, together with the recent breach of 20.00, reinforces this condition.
- The Sep 13, 2021 low at 19.8486 was briefly tested and a sustained break may target the June ’21 lows at 19.5987.
- Remittances data is due Friday, alongside the latest Banxico survey of economists.
- U.S. Special President Envoy for Climate John Kerry will visit Mexico and meet with President AMLO, other government officials and members of the U.S. business community.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
STIR FUTURES: Hiking paths being reassessed
Mar-01 11:21
Global STIR futures continue to move higher as markets reassess central bank hiking paths despite the higher than expected inflation prints from Italy and some German regions.
- Eurodollar futures the biggest G3 moves now, with Reds up to 18.5 ticks higher. Markets now pricing a little under 120bp of Fed hikes this year from around 135bp yesterday and highs of 170bps seen before the Ukrainian invasion.
- SONIA futures seeing Greens/Blues up 20 ticks with a flattening of the curve through Whites and Reds. Markets now price a further 110bp of hikes this year. 25bp hikes are fully priced for March, May and June, but two weeks ago we were pricing 45bp for March, now we are pricing 26bp. As recently as Friday, markets were pricing 130bp of hikes in 2022 and saw a peak of 167bp priced on 15 February. The MNI Markets team continues to look for 25bp hikes in both March and May, but the outlook beyond then continues to remain uncertain. We may be getting closer to a place where the risk/reward of being long is starting to look less attractive given the over 50bp move so far this year.
- For Euribor futures, ahead of the release of the MNI sources piece yesterday, around 31bp of hikes were priced for 2022, now 18.4bp is priced at the time of writing. Reds/Greens/Blues up 15-17 ticks on the day, too.
OUTLOOK: Tue Data Roundup, Markit PMIs, ISM, Fed Speak, Pres Biden St of Union
Mar-01 11:08
- US Data/Speaker Calendar (prior, estimate)
- Mar-01 ---- Vehicle sales
- Mar-01 0945 Markit US Manufacturing PMI (57.5, 57.5)
- Mar-01 1000 Construction Spending MoM (0.2%, 0.1%)
- Mar-01 1000 ISM Manufacturing (57.6, 58.0)
- Mar-01 1000 ISM Prices Paid (76.1, 77.5)
- Mar-01 1000 ISM New Orders (57.9, 56.3)
- Mar-01 1000 ISM Employment (54.5, 54.2)
- Mar-01 1120 NY Fed buy-op: TIPS 7.5Y-30Y, appr $0.625B vs. $1.225B prior
- Mar-01 1400 Atlanta Fed Bostic, business uncertainty survey discussion, Q&A
- Mar-01 1400 Cleveland Fed Mester, open remarks inflation conf
- Mar-01 2100 US Pres Biden State of the Union Address
GILT TECHS: (M2) Breaks Out Of Its Recent Range
Mar-01 11:08
- RES 4: 126.00 Round number resistance
- RES 3: 125.69 1.50 proj of the Feb 16 - 18 - 23 price swing
- RES 2: 125.40 1.382 proj of the Feb 16 - 18 - 23 price swing
- RES 1: 125.04 1.236 proj of the Feb 16 - 18 - 23 price swing
- PRICE: 123.08 @ Close Feb 28
- SUP 1: 122.76 Low Feb 28
- SUP 2: 122.04 Low Feb 23 and a key intraday support
- SUP 3: 121.10 Low Feb 16 and the bear trigger
- SUP 4: 121.00 Round number support
Gilt futures are rallying today and have broken out of its recent range. The move higher marks an extension of the current recovery that started from the 121.10 low of Feb 16. This signals scope for a climb towards 125.04 and 125.40 next, Fibonacci projections based on a recent price swing. Key short-term support has been defined at 122.04, Feb 23 low where a break is required to reinstate the recent bearish tone.
