2000-04-17 Price rebound
Daily Brady Bond Trading Commentary
Monday April 17, 2000
Emerging markets debt prices rebounded from a poor open Monday but continue to take direction primarily from U.S. equities.
Volumes remain thin, with the exception of Brazil C-Bonds, indicating that dealer positioning is the primary driver of flows. Argentina reported industrial production (advance figure) growth of 4% y/y for March, slightly disappointing market expectations but maintaining a positive trend nonetheless.
Brazil saw a small improvement in its current account deficit in March versus a year earlier, though the R$1.88 billion reading was larger than the R$1.25 billion figure for February.
The COPOM begins a two-day meeting on Tuesday, and expectations are for it to keep the selig rate steady at 18.50%. The probability of a Fed tightening next month, and again in June, is adding to downward pressure on EM debt prices.
Contributed by
Credit Lyonnais Securities (USA) Inc.
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