Firmer EM currencies despite.......>

EMERGING MARKETS: Firmer EM currencies despite quiet majors

-BRL outperformed as markets continue to watch domestic political developments.

The senate committee passed the pension bill shortly after markets opened,

although the presentation of fresh budget measures has been delayed due to some

ministerial absences. Higher inflation figures also proved supportive of the

currency. The continued pullback in BRL further cements the triple-top pattern

in USD/BRL.

-INR traded well after a gap lower in USD/INR. Onshore markets were closed

Monday for state elections, leaving Tuesday's trade to catch-up. Some wires,

however, have pointed out that state banks remain USD buyers (possibly on behalf

of the Indian central bank), which is helping slow USD/INR's decline.

-ZAR accelerated on the fall through the 100-dma against the USD. The break

below the support at 14.7158 was the first significant break since late June,

with USD/ZAR bears now eyeing 14.4337.

-South African CPI and the Chilean rate decision are Wednesday's highlights.

Chile are seen cutting rates by 25bps.