BRL is starting the day slightly stronger with mixed global backdrop where DXY gains are countered by higher oil and metal prices on strong results of China's trade balance. BRL is up 0.12% to trade at 3.1236. Local market is still mindful of BCB warning about BRL overvaluation in the back of traders' mind. Mixed news in the political scenario with the STF advancing inquiries on PMDB leaders and congress installing labor and social security commits to start on the work for the pension reform.
No data in the domestic market but news over the possibility of lower central inflation target could put some pressure on the DI market, where
Jan 18 is down 2bp to 10.70% and Jan 21 is down 3bp to 10.28%. The pricing in for February meeting rate cut is down 1bp to 79bp and for April is down 1bp to 71bp.
In the US, Dec import prices are due on Friday, with the advance Feb Michigan CSI following. This could attract attention if there is a big shift, but most signals on sentiment are currently showing recent sharp improvements being largely sustained. Also due on Friday are annual PPI revisions and Jan budget data.