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USDCLP Rises 1.00%, Closes Gap To Monday Highs

  • Andean FX has been underperforming on Wednesday with both the Chilean and Colombian pesos registering declines of over 1%. USDCLP has reversed the majority of Monday’s pullback and has edged back into positive territory on the week.
  • Copper futures have spent the session consolidating the turn lower on Tuesday and are hovering near the June 01 lows, having plummeted around 9% from the August 01 highs.
  • Furthermore, despite the acknowledgement of potentially slowing the pace of rate decreases at upcoming meetings, the initial 100bps BCCh cut continues to underpin CLP weakness, all amid a backdrop of economic activity that remains in negative territory (-1.0% Y/y in June).
  • USDCLP maintains a short-term bullish technical tone and with price trading closer to recent highs, the focus is on 886.62, the 50.0% retracement of the Sep 26 ‘22 - Feb 3 bear leg. First support to watch is 843.03, the 20-day EMA.
  • As noted, the central bank traders survey will be published tomorrow before both current account and GDP figures cross on Friday.

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