MNI China Daily Summary: Thursday, April 22

MNI BRIEF: China To Quicken Resolving Local Debt Risks

RPT-MNI INTERVIEW: ECB's Wunsch Sees At Least Two Cuts By Dec

MNI BRIEF: Brazil CenBank Faces Greater Uncertainty - Campos

MNI: PBOC Conducts CNY2 Bln Via OMO Mon; Liquidity Unchanged

CHINA PBOC INJECTS CNY2 BILLION VIA 7-DAY REVERSE REPOS MON

EZ/UK T-Bill Calendar: 3/6-Month ATB Auction on Tuesday

EZ/UK Bond Supply Calendar: EU, FI Synds; IT, DE Auctions Tues

MNI: CANADA MAR INDUSTRIAL PRICES +0.8% MOM; EX-ENERGY +0.8%

RPT-MNI: Canada Sticks To Fiscal Anchors, Spends Chunk Of Windfall

MNI BRIEF: Poilievre Calls QE 'Scam' And Would Limit BOC Remit

MNI: Growth Drag From Net Zero Carbon Goal Can Be Offset-OECD

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Goldman Sachs On BRL: Inflation-Fighting Credentials Reaffirmed

BRAZIL
  • Continued monetary policy vigilance underscores the key reason why BRL remains a top choice for EM FX investors: Brazil features a “virtuous circle” in which the Real is likely to benefit from rising real rates (as inflation continues to fall while nominal rates are kept elevated), and in which local rates are likely to benefit from a resilient Real.
  • Risks remain on the fiscal front, of course, and a significant policy misstep may still overshadow the overall FX-supportive macro environment in Brazil. And, we will be closely watching this week’s inflation print for any hints that, having now fallen from above 12% to below 6%, a further deceleration of headline inflation in Brazil could be bumpier than what we’ve seen so far.
  • Still, after being among the earliest and most emphatic central banks to raise rates in early 2021, the COPOM has reaffirmed its commitment to tackling inflation; overall, Goldman Sachs are shifting their USD/BRL forecasts lower: to 4.90, 4.85, and 4.80 in 3, 6, and 12 months, respectively (from 5.20, 5.20, and 5.00 previously).
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