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CHILE: Itaú Believes MoF Will Sell $400mn Weekly Cap At Least Through Mid-Dec

CHILE
BulletEM BulletEmerging Market News
  • In Itaú’s view, last week’s decision to increase the weekly maximum cap on dollar sales from $200mn to $400mn was driven by the accumulation of liquid dollar holdings at the Treasury, the sizable seasonal 4Q deficit, and important amortisations of local currency notes due by month’s end ($1.8bn).
  • Even though the MoF has tended to sell well below the cap of their guidance throughout most of the year, Itaú believes that a deeper look at the details suggests they are likely to sell their $400mn weekly cap at least through mid-December.
  • According to the most recent Treasury Asset report, the MoF had $688.1mn in dollar-denominated liquid assets at the Treasury by the end of September. Itaú estimates that this balance rose to roughly $1.4bn by the end of October, primarily reflecting the Stabilisation Fund withdrawal and mining-related revenues. The MoF is scheduled to publish updated fiscal data for October on November 29.
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  • In Itaú’s view, last week’s decision to increase the weekly maximum cap on dollar sales from $200mn to $400mn was driven by the accumulation of liquid dollar holdings at the Treasury, the sizable seasonal 4Q deficit, and important amortisations of local currency notes due by month’s end ($1.8bn).
  • Even though the MoF has tended to sell well below the cap of their guidance throughout most of the year, Itaú believes that a deeper look at the details suggests they are likely to sell their $400mn weekly cap at least through mid-December.
  • According to the most recent Treasury Asset report, the MoF had $688.1mn in dollar-denominated liquid assets at the Treasury by the end of September. Itaú estimates that this balance rose to roughly $1.4bn by the end of October, primarily reflecting the Stabilisation Fund withdrawal and mining-related revenues. The MoF is scheduled to publish updated fiscal data for October on November 29.