LATAM: MXN Falters as Front-End of Global Rates Curve Crushed on NFP
Aug-01 15:35
- EUR/MXN heads through the London close close to the day's highs as the correction lower in global rates feeds well into Latam FX, in turn triggered by the rush forward in Fed rate cut expectations on today's payrolls print.
- The cross has now undone the five sessions of losses that saw the rate drop 2% and hit the cycle low at 21.453. Today's rally also puts price through the downtrendline drawn off the Jul22 high on the 15-minute candle chart.
- In USD/MXN, the pair is through the 50-dma, a level that contained yesterday's rally and helped trigger the reversal off highs.
- BRL is faring better, holding the bulk of the USD/BRL downtick at the open. With 50% tariffs now fully expected and priced in, attention turns to Lula's address to the nation, at which he's expected to address the sanctioning of Judge Moraes primarily as well as the 50% general tariff. Lula is not expected to trigger any material counter-tariff, however the government are expected to retain this as an option going forward.
- Lastly, COP is holding the opening rally well after yesterday's surprised hold on rates at the BanRep. USD/COP has traded down to 4118.33 - but has stopped short of any test of 4110.67, the 61.8% retracement for the upleg off the early July low.
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FED: US TSY 17W BILL AUCTION: HIGH 4.185%(ALLOT 7.04%)
Jul-02 15:32
- US TSY 17W BILL AUCTION: HIGH 4.185%(ALLOT 7.04%)
- US TSY 17W BILL AUCTION: DEALERS TAKE 33.16% OF COMPETITIVES
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- US TSY 17W BILL AUCTION: INDIRECTS TAKE 60.47% OF COMPETITIVES
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FED: US TSY 17W AUCTION: NON-COMP BIDS $469 MLN FROM $65.000 BLN TOTAL
Jul-02 15:15
- US TSY 17W AUCTION: NON-COMP BIDS $469 MLN FROM $65.000 BLN TOTAL
US: House Moves To Consider The Rule Of OBBB, Inches Toward Final Vote
Jul-02 15:14
The House of Representatives has cleared the first procedural hurdle on the GOP's One Big Beautiful Bill. The House has now moved to debate the rule of the bill. When debate concludes, the House will vote to adopt the rule, potentially discharging the package for a floor vote on final passage. The vote will offer the first opportunity for conservative hardliners to signficantly delay passage of the bill by voting down the rule.
- The vote tally on the first procedural vote indicates there are currently eight Republican absences and one Democratic absence. That number is likely to change during the day.
- Meredith Lee Hill at Politico notes that Speaker Mike Johnson (R-LA), "just met off campus with a mix of fiscal hawks. Inside the meeting - there were Freedom Caucus hardliners but ALSO key and hugely influential budget hawks like Rep Lloyd Smucker of Pennsylvania that group held out for a better deal last time."
- If Johnson convinces hardliners to approve the rule, the bill will be on a relatively smooth path to Trump's desk. If the rule is rejected, negotiations and horse trading are likely to continue through the day.
- Rep Tim Burchett (R-TN) told reporters ahead of the White House meeting, when asked what the White House could say to flip his vote: “Reduce the deficit, answer our questions, stick to the House framework”.
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