MNI China Daily Summary: Thursday, June 27

MNI BRIEF: China EU In Close Communication - MOFCOM

MNI BRIEF: China To Hold Key Third Plenum On July 15-18

MNI Brief: China Third Plenum To Deepen Reforms

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Inflation Accelerates in June

Services Expected Prices Remain At Elevated Levels

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RPT-MNI: Canada Sticks To Fiscal Anchors, Spends Chunk Of Windfall

MNI BRIEF: Poilievre Calls QE 'Scam' And Would Limit BOC Remit

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Bull Steeper Post BoJ Ahead Of Further Key Data Releases

US TSYS
  • Cash Tsys have seen a bull steepening ahead of the US session getting underway, paring some of yesterday’s data-induced losses. The long-end underperforms with relative cheapening pressure from the BoC tweaking its YCC to allow for a drifting higher in 10Y yields with a cap now at 1%, after heightened volatility following the decision which saw 10Y Tsy yields almost touch 4.04%.
  • Fed Chair Powell on Wednesday put particular emphasis on data dependency, hence the strong reactions to yesterday’s GDP, initial claims and less so durable goods beats, and further important releases headline today’s docket. We particularly watch core PCE for June and revisions after yesterday’s softer than expected Q2 advance, plus the ever-important ECI for Q2 for more compositionally robust measures of wage growth.
  • 2YY -6.0bp at 4.868%, 5YY -5.4bp at 4.184%, 10YY -3.2bp at 3.967%, 30YY -1.0bp at 4.029%
  • TYU3 trades 10+ ticks higher at 111-11 and off lows of 110-25+, after extremely elevated volumes of 600k following the BoJ decision and some European regional inflation prints. The low cleared multiple support points including 110-28 (76.4% retrace of the Jul 7-18 rally) to open a bear trigger at 110-05 (Jul 6 low).
  • Data: ECI Q2 (0830ET), Incomes/spending/core PCE Jun (0830ET), U.Mich Jul final (1000ET), KC Fed services Jul (1100ET).
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