And the emerging FX malaise continues with more concerns on global growth amidst thin liquidity. MXN is down 0.9% to trade at 17.77 coming from overnight trading and ahead of US ADP data. The change in tone may prompt more discussion about MXN weakness in the monetary policy meeting tomorrow. Looking ahead only a weak ADP (under 190K) number will change trend
In the domestic market there is only the usually overlooked gross fixed investment data for which we expect a 4.5%y/y reading to go along with the strong economic activity in Feb and the low comparison base. Leading indicators for March should benefit from stronger MXN and the recovery in the equity market and the lower risk aversion as well.
In the US, we should see a 205k increase in Apr's ADP estimate for private sector employment growth, and a fall in Mar's trade deficit to $40.3bn from $47.1bn. We expect a 1.2% decline in Q1 non-farm productivity with a 4.0% rise in unit labor costs. Apr's ISM mon-manufacturing index should rise to 55.5 from 54.5 while Mar factory orders should increase by 0.6% Moderate-hawkish Fed non-voter Kashkari speaks on Wednesday.
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