PERU: USDPEN Falls 0.6%, Q1 GDP Due Tomorrow
May-22 16:45
- The Peruvian Sol is outperforming peers today, amid a recovery in copper from session lows, with USDPEN falling 0.6% towards 3.65. This marks the third successive session of losses for the pair, unwinding most of the recent gains which saw USDPEN rise from a low of 3.63 on May 9 to a peak of 3.70.
- Deutsche Bank still expects PEN to trade rangebound toward year-end, with the currency remaining somewhat isolated to the weaker global growth outlook, given its low beta status and healthy BoP position. They note that the BCRP continues to actively participate in the FX market (in spot and forward swaps) and can step in in the event of a disorderly shock. They see USDPEN at 3.70 at year-end.
- Looking ahead, Q1 GDP data are due tomorrow, with the monthly activity figures consistent with a moderation in growth to 3.9% y/y, from 4.2%. On a q/q (sa) basis, Goldman Sachs see a deceleration of growth to 0.65%, from 1.1% in Q4. However, BBVA says that the GDP data are unlikely to have a big impact, given that the figures are relatively dated now.
- Separately, mining GDP rose 3.1% y/y in Q1, driven by higher output of copper and silver, among others. However, activity will weaken in Q2 due to the 30-day mining ban in Pataz province that the government introduced to contain recent violence. Nonetheless, mining investment remains robust (+4.6% y/y in Q1 to $1.06bn) and Scotiabank expects favourable metals prices to continue to support it ahead (full year forecast at $5.3bn).
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FED: US TSY 2Y AUCTION: NON-COMP BIDS $260 MLN FROM $69.000 BLN TOTAL
Apr-22 16:45
- US TSY 2Y AUCTION: NON-COMP BIDS $260 MLN FROM $69.000 BLN TOTAL
US TSYS/SUPPLY: Preview: 2Y Note Auction
Apr-22 16:33
Tsy futures are just off late-morning highs (TYM5 currently +1.5 at 110-27.5 vs. 110-30 high) ahead of the $69B 2Y note auction (91282CMY4) at 1300ET, WI is currently running at 3.787%, 19.7bp rich to last month's in-line sale.
- March auction recap: Tsy futures remain bid (TYM5 +8 at 110-25.5) after the latest $69B 2Y note auction (91282CMV0) came out in-line: 3.984% high yield vs. 3.985% WI; 2.66x bid-to-cover vs. 2.56x prior.
- Peripheral stats: Indirect take-up receded to 75.77% from 85.49% prior, directs climbed to 13.58% vs. 7.64% prior, primary dealer take-up 10.65% vs. 6.87% prior.
ITALY T-BILL AUCTION PREVIEW: On offer next week
Apr-22 16:31
MEF has announced it will be looking to sell the following at its auction next Monday, April 28:
- E2.0bln of the 5-month Sep 12, 2025 BOT
- E2.0bln of the 5-month Sep 30, 2025 BOT
