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USDCLP Squeezes Back Above 700, After Testing 2021 Lows

CHILE
  • USDCLP bounced back above 700 yesterday, after briefly trading below 695 and trading in close proximity to the year's lows at 693. USD strength aided the squeeze, with dealers reporting strong local buying. Additionally, copper had a strong reversal from the psychological $10,000-a-metric-ton. Short-term accounts potentially using both this level and sub-700 in USDCLP as a signal to take profit with ongoing noise surrounding the pension withdrawal and potential wealth tax.
  • Chile Central Bank announced measures on the upcoming third pension withdrawal:
  • Reopening of a special program by which it buys in spot market and sells in future as much as $9.5b in assets held by banks and other financial institutions; and renewal of a current program for $500m (accepting bank bonds and other bank instruments as deposits). Find the press release here: https://www.bcentral.cl/en/content/-/details/banco-central-dispone-medidas-ante-nuevo-retiro-de-fondos-previsionales
  • 8am local: Chile umbrella labour group CUT calls for general protest against President Sebastian Pinera's administration.

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