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USDMXN Remains Above March 2021 Highs

LIBOR

JAPAN FIX - 29/11/21

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  • While a rising number of EM central banks have been surprising the market by raising their policy rate more aggressively in order to curb the inflationary pressures, CBRT is expecting to cut is benchmark rate at its policy meeting this week (Oct 21) despite the inflation rate standing at 19.6%.
  • Market consensus is pricing in another 100bps cut (last month, CBRT unexpectedly cut its 1W repo rate by 100bps), which will bring back the policy rate to early 2021 levels.
  • Selling pressure on the Lira has remained elevated in recent weeks, with TRY constantly reaching new all-time lows against the US Dollar.
  • Not surprisingly, the TRY is the worst performing currency this year among the EM world, down nearly 20% against the USD.
  • USDTRY: Next important level to watch on the topside stands at 9.53, which represents the 138.2% Fibo projection level of the 6.90 – 8.80 range.

Source: Bloomberg/MNI