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Summary – February 28

LATAM
  • Banxico will publish its latest quarterly inflation report today, providing an update of its macro outlook and forecasts and implications for the monetary policy outlook and scope for a March rate cut. Chile labour market data for January will also cross. In Brazil, the G20 finance ministers and central bank governors meeting gets underway later in Sao Paulo.
  • In the US, the calendar includes 2nd readings for GDP/Core PCE and wholesale inventories for January. Central bank speak includes the Fed’s Bostic, Collins and Williams.
  • Global News:
    • US – President Biden and Republican frontrunner Donald Trump both cruised to victory in their party’s Michigan primary elections Tuesday, with results for the two candidates indicating discontent among Democrats and Republicans for the likely nominees. Meanwhile, President Biden and congressional leaders appear to be closing in on a deal that could keep the government open past the weekend.
    • OIL – Oil stockpiles in developed nations have tumbled to the lowest seasonal level in at least four years after Red Sea attacks led to some tankers avoiding the waterway, keeping crude in transit for longer. Onshore commercial and strategic inventories were at 1.62bn barrels as of Feb 26 for OECD members, according to data analytics firm Kpler.
    • EU (MNI) – inflation will continue to slow across the eurozone in the coming months, but the ECB's Governing Council will need to be “absolutely convinced” that it is converging towards the 2% target before starting to cut interest rates, Vice President Luis de Guindos said Wednesday.
    • CHINA (MNI Beijing) – fears that China will export deflation to the world are overblown, with the country’s inflation likely to move out of negative territory as domestic demand picks up and the drag from commodity prices wanes, the IMF’s deputy mission chief for China told MNI. Chinese inflation will turn positive this year and is likely to reach 1.4% y/y, while declines in producer prices have mainly been driven by global factors, Nir Klein said.

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