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Industrial Production Data, Copom Set To Hike Another 150Bps

BRAZIL
  • Firmer equity indices and advances in the commodity complex should continue to support the Brazilian real which closed yesterday at its best level since mid-September around 5.27.
  • Markets also fully expecting another 150bp hike to the Selic rate after the close with guidance in the statement eagerly awaited.
  • The full MNI preview for the February meeting with analyst views can be found here: https://marketnews.com/mni-bcb-preview-feb-2022-another-sizeable-hike-seen-guidance-in-focus
  • Foreign inflows continue to dominate the local FX and equity markets dynamics; Ibovespa received $6.12 billion of foreign cash in January, the most since November 2020 and the second-biggest monthly inflow ever. (BBG)
  • Brazil’s congress will hold its first session of the year and investors will watch how negotiations to reduce fuel taxes evolve.
  • Data Scheduled at the top of the hour:
    • 1200GMT/0700ET: Dec. Industrial Production YoY, est. -5.9%, prior -4.4%
    • 1200GMT/0700ET: Dec. Industrial Production MoM, est. 1.6%, prior -0.2%

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