LATAM FX: Regional Currencies Outperform Amid Equities Recovery
Apr-22 18:09
- Latam currencies continue to outperform today, buoyed by the recovery in global equities and firmer oil and copper prices. Gains were pared, however, after US Treasury Secretary Bessent said that negotiations with China would be a slog, having earlier indicating that he expects the situation with China to de-escalate.
- USDMXN remains 0.7% lower around the 19.60 mark, off session lows at 19.5244. As noted earlier, the recent range breakout for the pair signals scope for a more protracted move towards 19.3711, the 38.2% of the Apr 9 ‘24 - Feb 3 bull cycle.
- Meanwhile, USDBRL remains 1.25% lower around 5.74. Below here, the key support remains further out at 5.5933, the Apr 3 low.
- Elsewhere, the Chilean peso continues to outperform peers, buoyed by a 2% bounce in copper prices. USDCLP fell to a MTD low at 941.28 earlier, before paring the move slightly, with the pair currently ~1.9% lower on the session around 943.
- On the data front, the Citi economist survey is due in Mexico shortly, before attention turns to Mexico retail sales stats tomorrow, with the weak growth backdrop set to keep the door open to another 50bp Banxico rate cut in May.
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CANADA PM CARNEY TO MEET GOVERNOR GENERAL AT NOON
Mar-23 11:22
- CANADA PM CARNEY TO MEET GOVERNOR GENERAL AT NOON
- CARNEY EXPECTED TO SEEK ELECTION
US TSYS: Available "Extraordinary Measures" Pick Up Slightly From Lows
Mar-21 21:00
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
Mar-21 21:00
- 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.
