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Local Markets Reopen Following Holiday

CHILE
  • The Chilean Peso is likely to be buoyed at the open following the news that Hacienda intend to sell dollars via a liquidation program.
  • During the next 60 days, it is estimated that a total of up to US$ 5 billion of excess liquidity in foreign currency from the fiscal box will be auctioned, with a daily maximum of US$ 200 million.
  • It should be noted that due to significant changes in market and/or fiscal conditions, the amounts and terms indicated above may be modified, which will be informed in a timely manner.
    • Scotiabank have noted that while central bank intervention remained an option, should the actions announced by the ministry of finance strengthen the peso below USDCLP 900 in the short term, the bank believed the likelihood of foreign exchange intervention by the BCCh would be reduced.
  • While CLP may stage a relief rally, gains may prove to be short-lived with obvious political headwinds still in play as well as the downward pressure on copper prices.
  • The latest Cadem survey showed President Boric's approval fell to 34%, its lowest level, and Rejection of the new Constitution rose to 51%, 18pts above the Approve option (33%).

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