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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
EM FX
- HUF has been the best performer among EM currencies in August as NBH maintains its hawkish tone, delivering its third consecutive 30bps interest rate hike on August 24, raising the benchmark rate to 1.50%.
- HUF is up 2.3% against the USD this month; USDHUF is currently testing its 295 support, a break below that level would open the door for a move down to 290 (June 16 low).
- Interestingly, MYR and INR are two next best performers in August, up 1.6% against the US Dollar, despite both central banks keeping the policy rate on hold due to rising uncertainty over the Delta variant.
- The rapid deceleration in inflation in Malaysia in recent months combined with the broad ADXY strength in the past two weeks could be two explanations behind Asian and SE Asian currencies strength in August.
- On the other hand, CLP has been the weakest performer, down 3.1% against USD despite the recent 'hawkish' speculation on faster rate hikes and relatively high copper prices.
- Political uncertainty surrounding the Presidential candidates combined with the re-writing of the constitution have been weighing on the CLP over the summer.
- The overheating economy (with CPI inflation up 4.5% YoY in July, breaking above the 4% central bank's upper tolerance band) has shifted expectations for a 50bps on August 31 following the 25bps hike in July, which will lift the policy rate to 1.25%.
Source: Bloomberg/MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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