Chinese GDP Miss Moderates Risk-On Flows, NZD Bid After Labour Landslide

A miss in China's Q3 GDP arrested the upswing in commodity-tied FX, linked to an early uptick in e-minis, but failed to generate any sustained risk-off impulse as local economic activity indicators topped forecasts, sending an optimistic signal re: economic recovery dynamics. Onshore yuan printed its best levels vs. the greenback since Apr 2019 in the lead-up to the release, but both CNY & CNH wiped out initial gains. Yuan dynamics inspired the Antipodeans to trim gains, but they remained afloat nonetheless.

• NZD outperformed its G10 peers after New Zealand's ruling Labour Party secured a landslide victory in the country's general election. PM Ardern's party will be able to govern alone, but still intends to talk with the Greens over an unspecified form of potential collaboration. AUD drew some support from demand for its Antipodean cousin.
• GBP started on a softer footing, as regional players digested Friday's downgrade to the UK's sovereign rating by Moody's, but regained poise amid reports noting that the UK is willing to water down its controversial Internal Markets Bill in a bid to revive talks with the EU.
• USD/JPY erased its initial modest gains on the back of a round of sales into the Tokyo fix.
• KRW led gains in Asia. Broader risk-on impetus allowed USD/KRW to print a fresh 18-month low, despite the absence of any meaningful local catalysts.
• Focus turns to the BoC's Business Outlook Survey and comments from a whole host of central bankers from the Fed, ECB, BoE, Riksbank & Norges Bank.