Poland hired bankers to arrange the issuance of euro-denominated bonds
Emerging Currencies Weaken as China Stimulus Sparks Dollar Gains
A gauge of emerging-market currencies slipped Monday as lackluster Chinese stimulus measures propelled the greenback higher amid thin trading during a bond market holiday.
Currencies from Chile, Peru and Mexico were among the biggest losers in the session, while the Brazilian real bucked the trend, outperforming all peers.
Over the weekend Chinese Finance Minister Lan Fo’an pledged new steps to support the property sector and hinted at greater government borrowing, but fell short of providing a headline figure for the stimulus and failed to announce additional plans to shore-up consumption.
“The disappointing fiscal news out of China this weekend curtails upside momentum for risk assets and offers USD support,” Elias Haddad, a strategist at Brown Brothers Harriman, wrote in a note. “The bias is for a stronger USD because there is greater room for an upward reassessment in US interest rate expectations relative to other major economies.”
The Bloomberg Spot Dollar Index advanced 0.3% Monday. Federal Reserve Minneapolis President Neel Kashkari said it appears likely that “further modest reductions” in the central bank’s benchmark interest rate will be appropriate in the coming quarters. Governor Christopher Waller is scheduled to speak later.
“In general, it’s a day with low liquidity,” said Erick Martinez Magana, a strategist at Barclays in New York.
On stock markets, the US S&P 500 advanced on optimism over upcoming corporate results, while the broad gauge for developing-world equities, heavily weighted to Asian shares, was little changed. The two largest exchange-traded funds listed in the US tracking emerging-market stocks fell.
In credit markets, Poland hired bankers to arrange the issuance of euro-denominated bonds, potentially tapping the international debt market once more after two unusually large sales in 2024.
Elsewhere, holders of Ukraine’s GDP warrants hired PJT Partners Inc. as their financial adviser ahead of a potential restructuring, according to people familiar with the matter.
