EM FX was mostly softer last week, though it ended the week firmer, buoyed by outsized MXN gains Friday. The Fed is sending very strong signals for a March hike, which should keep EM FX on its back foot. However, with the March 15 FOMC embargo coming into effect, there will be no Fed speakers after Kashkari on Monday.  Jobs data on Friday will be the highlight, but given the Fed’s signals, we do not think a soft report will derail a hike next week.

EM CPI and real sector data this week should support our view that Asian and EMEA central banks will have to tilt more hawkish this week. Latam data should show further disinflation that supports a more dovish tilt in that region.

Chile reports January GDP proxy Monday, which is expected to rise 1.1% y/y vs. 1.2% in December.  Chile reports February trade Tuesday. It then reports February CPI Wednesday, which is expected to remain steady at 2.8% y/y.  While still within the 2-4% target range, the stalled disinflation warrants some caution on the part of the central bank. Next central bank meeting is March 16, and no change is likely then.  

Taiwan reports February CPI and trade Tuesday.  CPI is expected to rise 0.75% y/y vs. 2.25% in January, while exports are expected to rise 16.3% y/y and imports by 24.9%. Note that January and February data will be distorted by the timing of the Lunar New Year in 2016 (February) and 2017 (January). The central bank does not have an explicit inflation target, but rising price pressures should keep it on hold at its next quarterly policy meeting this month.

Philippines reports February CPI Tuesday, which is expected to rise 3.2% y/y vs. 2.7% in January.  If so, this would be the highest rate since November 2014, but still be within the 2-4% target range.  Next policy meeting is March 23, and rates are likely to be kept steady at 3.0%.  The central bank will be on alert and may turn more hawkish if price pressures accelerate further.