Amazon in negative pending 2020 results


Swaps predict losses for bonds in pesos: Chile Fixed Income

(Bloomberg) – The decline in spreads between Chile’s interest rate swaps and government bonds has traders and analysts betting on more losses for peso bonds. Swap spreads in Chile are often negative due to to the different investor bases for swaps and bonds. Earlier this month, the peso-denominated BTP 2030 rate fell below the 10-year peso-chamber interest rate swap rate. The swap spread has averaged around -29 basis points since November 2018, when the 2030 BTP was issued, according to data compiled by Bloomberg. The most recent spread was just -5 basis points. The swap rate generally reacts faster to movements in US Treasury yields than local BTP rates. The yield on US 10-year bonds rose more than 1% this month for the first time since March last year amid expectations that a victory by Democrats in the Congressional and White House elections would bring more fiscal aid. ” The spreads between the two curves will tend to converge in line with historical averages, but steeper, ”said Mario Castro, fixed income strategist for Latin America at BBVA in New York. In Chile, expectations of an economic recovery as the government implements its vaccination program and higher copper prices will also lead to lower demand for nominal notes and higher yields, he said. Longer-term nominal rates will likely increase. in the coming weeks, due to the adjustment of portfolios and given that the local swap curve has been pushed up by rates in dollars, said Sebastián Ide, manager of the trading area at Banco de Chile. Investors could trim exposure to fixed income as they reposition into equities. Chile’s economic recovery is expected to be stronger than many regional peers, in line with the government’s vaccination program. About 12,000 healthcare workers have already received the vaccine, while an additional 180,000 doses of Pfizer-BioNTech will arrive this month, plus 680,000 in February, President Sebastián Piñera said on Jan. 14, despite the second wave of infections due to Covid-19 is gaining traction, both the local and global markets are likely to pay more attention to advances in the vaccination process, said Humberto Mora, investment strategist at Fynsa. LAST WEEK The central bank’s announcement that it would buy US $ 12,000 million in foreign currency led the peso to perform the worst in the world last week, with a loss of 3.4%. The central bank also reported that economists raised their GDP forecasts to 5% in 2021 from 4.7%, according to their monthly survey. The government increased the number of municipalities in total quarantine from 18 to 44, amid an increase In the cases of covid-19, on the corporate side, local banks turned to the market to secure cheap financing. BCI sold 3 million UF (US $ 118 million) in 10-year bonds at 0.27%, while Itaú Corpbanca sold 1 million UF as of 2029 at 0.09%. THIS WEEK In Chile: January 22: Survey of financial operators from Central Bank Jan 22: Dec Producer Price Index International: US: Jan 21: Philadelphia Fed Business Outlook Jan 22: Markit Manufacturing PMI in January Jan 22: Markit Services PMI in January Jan 22: Markit Composite PMI in January Jan 22: Existing home sales in December Eurozone: January 20: CPI in December January 22: Markit’s manufacturing PMI in January January 22: Markit’s services PMI in January January 22: Markit’s composite PMI in January RECENT NEWS: Bank of America raises Chile inflation forecast to 3.4% in 2021 Chile GDP will contract 6% in 2020, says Banchile InversionesItaú Corpbanca places 1m UF bonds to 2029 in Chile at 0.09% Chile reports 12,787 vaccinated people; 5,739 with two doses Chile’s court rules against permits in BHPM copper mine Codelco falls in the second wave of covid-19 in Chile Chile announces more restrictions due to covid-19 in 5 communes New mining minister Chile anticipates “good” copper prices Sales of copper Speculative grade debt in Latin America Chilean peso leads losses with Central Bank increasing reserves Buying dollars is not intervention, FX will continue to fluctuate: BCChBCI places 3m UF in 10-year bonds in Chile at 0.27% Deputies in Chile reject withdrawal project Life annuities Chilean peso registers the largest drop in the world Chile receives 88,700 doses Pfizer, will begin elderly vaccine BCCh seeks to increase international reserves level to 18% of GDP President of Chile Piñera begins preventive quarantine Moderate Chile would gain 1/3 of convention banks: Eurasia Chile’s economists raise GDP projection 2021: Central Bank Central Bank of Chile will not issue new bonds in 2021’Ol a Populista ‘is Chile’s biggest risk, says Credit Suisse BOND PIPELINE: RECENTLY ISSUED BONDS: For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source. © 2021 Bloomberg LP

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