MNI China Daily Summary: Tuesday, December 31

MNI China Press Digest Dec 31: PBOC, Panda Bonds, EVs

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MNI: China CFETS Yuan Index Down 0.13% In Week of Dec 27

MNI:US OCT FHFA HPI SA +0.4% V +0.7% SEP; +4.5% Y/Y

MNI: US REDBOOK: DEC STORE SALES +5.5% V YR AGO MO

EZ/UK T-Bill Calendar: 1/3/6-Month UKTB Auction on Friday

MNI EXCLUSIVE: EU-Mercosur Deal Close, But Likely Short-Lived - Officials

AUSTRALIA: 2025 Election Outcome Looking More Uncertain According To Newspoll

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BRAZIL: USDBRL Pierces 6.00 Level for First Time as Haddad Rhetoric Ignored

BRAZIL
BulletEM BulletEmerging Market News
  • Despite Finance Minister Haddad’s plea to the markets to have a second look at the details of the fiscal announcement and to consider social justice, USDBRL briefly tested the 6.00 handle as the trajectory for the pair continues to point north.
  • Haddad acknowledged that the US dollar has been strengthening globally, however, this week’s standout strength for USDBRL (+3.25%) will be a stark reminder of the fiscal scepticism amid global investors and bolster BCB concerns of the exchange rate negatively impacting inflation expectations going forward.
  • Analysts have appeared more comfortable with USDBRL on a 6 handle, with Morgan Stanley seeing the currency “consolidating” around 6.30 into the 2026 election and ING recently revising their 12-month USDBRL forecast to 6.25 “which seems to be the direction of travel”.
  • For immediate targets, we note again that 6.0257 is the 2.00 projection of the Aug 19 - 30 - Sep 19 price swing and the 2.236 projection is at 6.1000. Support moves up to 5.7754, the 20-day EMA.
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  • Despite Finance Minister Haddad’s plea to the markets to have a second look at the details of the fiscal announcement and to consider social justice, USDBRL briefly tested the 6.00 handle as the trajectory for the pair continues to point north.
  • Haddad acknowledged that the US dollar has been strengthening globally, however, this week’s standout strength for USDBRL (+3.25%) will be a stark reminder of the fiscal scepticism amid global investors and bolster BCB concerns of the exchange rate negatively impacting inflation expectations going forward.
  • Analysts have appeared more comfortable with USDBRL on a 6 handle, with Morgan Stanley seeing the currency “consolidating” around 6.30 into the 2026 election and ING recently revising their 12-month USDBRL forecast to 6.25 “which seems to be the direction of travel”.
  • For immediate targets, we note again that 6.0257 is the 2.00 projection of the Aug 19 - 30 - Sep 19 price swing and the 2.236 projection is at 6.1000. Support moves up to 5.7754, the 20-day EMA.