CHILE: President Boric Highlights Need To Diversify Exports, Jan Nominal Wages
Mar-06 11:42
- In the face of threats from the US to impose tariffs on copper imports, President Boric said yesterday that the country must take all the necessary steps, including the diversification of its export base, to prepare itself. Boric ordered the agriculture minister to work with the Ministry of Foreign Relations to analyse scenarios regarding the country’s food exports to the US.
- The Chilean peso rallied sharply yesterday, buoyed by the surge in copper prices amid the tariff threat, with USDCLP closing at its lowest level since October 15, around 930. The move narrowed the gap to 9.2343, the Oct 11 low, and 921.59, the 76.4% retracement of the upleg between Sep 27 ‘24 - Jan 3.
- On the data front, nominal wage figures for January will be released at 1200GMT(0700ET). In December, wage growth moderated to 7.3% y/y, from 8.5%, a six-month low. Following these data, attention turns to tomorrow’s February CPI and trade numbers, with the former set to show inflation remaining above the top of the BCCh target range, despite likely moderating last month.
- Jan. Nominal Wage YoY, prior 7.3%
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STIR: Fed Rate Path Consolidates Modest Softening On Tariff Delays
Feb-04 11:42
- Fed Funds implied rates hold yesterday’s modest paring of previous climbs, following a one-month delay of 25% tariffs on Canada and Mexico. The deadline for setting 10% tariffs on China has passed and China has since announced targeted retaliatory measures of its own due to be effective Feb 10.
- Cumulative cuts from 4.33% effective: 4bp Mar, 10bp May, 20.5bp Jun, 25bp Jul and 42bp Dec.
- The 42bp of cuts for 2025 is up from 38bp at yesterday’s peak when the US was still set to push ahead of 25% tariffs on Canada and Mexico. The recent range includes last week’s 54bp on US tech-led risk-off and 24bps after last month’s strong payrolls report.
- Trump administration policy-related headlines are likely to remain the main driving force in the immediate future but today’s JOLTS report for December can also have an impact.
- Bostic (non-voter) speaks for a second day running in a moderated discussion on housing at 1100ET. He didn’t move the needle yesterday, suggested in a Q&A that the Fed may be "waiting for a while" before easing rates further. "I want to see what the 100 bps we did last year translates to in terms of the economy. Depending on what the data are, it might mean that we are waiting for a while."
- Daly (non-voter) also speaks in a moderated panel at 1400ET. She last spoke Jan 4, saying inflation remains uncomfortably above the 2% target and that the labor market is roughly in balance with no desire to see any further slowing. The Fed is now facing more of a trade-off between inflation and the jobs market.
LOOK AHEAD: Tuesday Data Calendar: JOLTS, Factory/Durables Orders, Fed Speakers
Feb-04 11:33
- US Data/Speaker Calendar (prior, estimate)
- 4-Feb 1000 JOLTS Job Openings (8.098M, 8.000M)
- 4-Feb 1000 JOLTS Job Openings Rate (4.8%, 4.8%)
- 4-Feb 1000 Factory Orders (-0.4%, -0.8%)
- 4-Feb 1000 Durable Goods Orders (-0.2%, -0.2%)
- 4-Feb 1000 Cap Goods Orders Nondef Ex Air (0.5%, 0.5%)
- 4-Feb 1000 Cap Goods Ship Nondef Ex Air (0.6%, 0.6%)
- 4-Feb 1100 Atl Fed Bostic moderated discussion on housing (no text, Q&A)
- 4-Feb 1130 US Tsy $85B 42D CMB auction
- 4-Feb 1400 SF Fed Daly moderated discussion (no text, Q&A)
- 4-Feb 1930 Fed Gov Jefferson economic outlook (text, Q&A)
ESM ISSUANCE: 3-Month ESM-Bill
Feb-04 11:32
| Type | 3-month bills |
| Maturity | May 8, 2025 |
| Amount | E1.088bln |
| Target | E1.1bln |
| Previous | E1.095bln |
| Avg yield | 2.464% |
| Previous | 2.649% |
| Bid-to-cover | 2.91x |
| Previous | 3.65x |
| Previous date | Jan 07, 2025 |
