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Debt Ceiling Update

Following up on the agreement reached between President Joe Biden and House Speaker Kevin McCarthy on the debt ceiling, here is an update with the relevant points:  Over the weekend an agreement on the “Fiscal Responsibility Act”, which suspends the debt limit until next January 1st, 2025, was announced.  The main source of budget savings […]

Is the dollar’s dominance in doubt?

Throughout this year, the US dollar’s dominant position as the largest global reserve currency has been questioned. This is not the first time this questioning has arisen, having as precedents: the birth of the euro in 1999, the great financial crisis in 2008 and the cryptocurrency boom. That said, the perspective that China’s yuan could […]

The disinflation process continues, although employment remains strong

The consumer price index accelerated 0.4% monthly in April from 0.1% in March. This figure was in line with what the consensus was expecting, and at the same time allowed a slight reduction in inflation in annual terms, reaching a rate of 4.9% (vs. 5.0% in March and 5.0% expected). For its part, the index […]

FED: “Rise in line that could represent a pause moving forward”

In line with what was expected by the market and unanimously, the FED increased the reference rate by 25bp to 5 – 5.25%. This movement represented the tenth increase since March 2022 and implied its highest level since September 2007.  Within the statement, it stood out that the Federal Open Market Committee (FOMC) reiterated that […]

The process of disinflation continues in the United States

Headline inflation slowed in March after registering a monthly increase of 0.1% in the consumer price index (CPI), with a rise of 0.4% observed in February and contrasting positively with the consensus expectation of 0.2%. In this context, annual inflation reached a rate of 5.0% (vs. 6.0% in February and 5.1% estimated). Overall, “shelter” costs […]

Expectations for 1Q23 corporate reports

The corporate reporting season is about to begin. In this context, the consensus considers that the companies of the S&P 500 would have recorded a contraction of 5% per year in their profits in 1Q23 (excluding the energy sector, the contraction of profit would be 6.6% YoY). This would represent the most significant drop in […]

Quick Guide to CoCos After Buying Credit Suisse

In the past two weeks, markets have experienced not seen volatility since the pandemic with the Silicon Valley Bank default, which subsequently led to the decline and purchase of Credit Suisse by UBS AG.  During the weekend of March 18, UBS AG agreed to buy Credit Suisse for $3.2 billion (less than $0.8 per share) […]

FED: “The banking system is sound and resilient”

The statement stressed that recent indicators point to moderate growth in spending and production. Job creation in recent months has been notable, allowing the unemployment rate to remain low, although inflation remains high. On the other hand, he stressed that the US banking system is solid and resilient. Consequently, recent events will probably result in […]