October 17, 2024 11:49 GMT
CHILE: ING Fearful BCCh Could Be Cutting Too Deeply
CHILE
- ING are fearful that the Chilean central bank could be cutting rates too deeply and the peso starts to take the strain again – especially with the BCCh having failed to rebuild FX reserves after a massive intervention campaign in 2022.
- The fact that Chinese stimulus measures have yet to deliver a material re-rating in China's growth prospects is evidenced by the ongoing weakness for CLP, which continues to trade towards the weak side of a four-month trading range.
- As ING have previously discussed, the real rate protection for the peso is starting to look very lean, and ING note the peso suffered greatly under Trump between 2018-19. Pressure appears to be building for USDCLP to push decisively through 950.
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