Fynsa
Historically, fixed income begins to outperform cash before the Federal Reserve reaches its maximum interest rate.
The Fed's actions led to a significant sell-off in dollar rates, with the 10-year treasury rate at a high of 4.50%, a level not seen since 2007.
We can expect that, as far as possible, the next cuts in the TPM will remain in the more conservative range of the corridor presented in the last IPoM.
The current scenario considers the worst conditions for the Chilean peso, with a local rate that should reach 8% by the end of the year.
For the Central Bank, the pace of future interest rate cuts is not tied to the magnitude of the first one, thus relativizing the urgency to migrate quickly to a neutral level.
And suddenly, interest rates are important again.
Despite higher financing costs and higher home prices than two or three years ago, the U.S. residential market will continue to perform well.
The likelihood of a further hike or a further pause at the Fed's next September meeting will depend on data developments.
The beginning of the monetary easing cycle will accelerate the transition of portfolios from IIF to IRF. Levels and accruals enhance the value of the short end of the interest rate curve, but UF instruments gain attractiveness, especially between 2 and 5 years.
