MNI China Daily Summary: Friday, December 13

MNI BRIEF: PBOC To Curb Any Yuan Overshot : PBOC Zou

MNI: GERMANY OCT EXPORTS -2.8% M/M (VS FCST -2.6%)

CHINA YTD NEW LOANS CNY17.1 TRLN VS MEDIAN CNY17.5 TRLN: PBOC

MNI: PBOC Net Injects CNY14.2 Bln via OMO Friday

MNI: PBOC Sets Yuan Parity Higher At 7.1876 Fri; -1.22% Y/Y

MNI: EUROZONE OCT IP +0% M/M, -1.2% Y/Y

MNI: SPAIN NOV HICP +0% M/M, +2.4% Y/Y

MNI: FRANCE NOV HICP -0.1% M/M, +1.7% Y/Y

MNI EXCLUSIVE: EU-Mercosur Deal Close, But Likely Short-Lived - Officials

AUSTRALIA: 2025 Election Outcome Looking More Uncertain According To Newspoll

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Corporate Supply Weighs On Long-end Yields, 2y Auction Well Supported

US TSYS
  • Treasuries ended Tuesday's session mixed, the curve was steeper with the front-end out-performing after there was strong demand for the 2yr note at the monthly auction with primary dealers being allocated a record low as investor demand soared, bid to cover was 2.81, the highest in roughly a year.
  • The under-performance in the long-end was driven by decent size corporate bond supply with Occidental Petroleum issuing a 5 part & United health issuing an 8 part deal pressuring longer dated yields for a total size of $17b
  • Treasury futures saw weakness post the bell on Tuesday, with TYU4 paring the sessions gains. We have opened -0-04 at 110-24, just above initial support at the 20-day EMA at 110-22, a break here would open a move to 110-09 (50-day EMA)
  • The treasury curve bull-steepened on Tuesday, with yields were -2.6bps to +1.5bps with the 2y closing -2.6bps at 4.491%, while the 10yr closed -0.2bps at 4.251%, the 2s10s was +2.374 at -24.290
  • Projected rate cut pricing into year end are steady to mildly higher vs. Tuesday morning levels (*): July'24 at -2.5% w/ cumulative at -0.6bp at 5.323%, Sep'24 cumulative -25.1bp (-24.3bp), Nov'24 cumulative -39.6bp (-38.5bp), Dec'24 -62.2bp (-61.1bp)
  • looking ahead, Wholesale/Retail Inventories, Flash PMIs and New Home Sales; Tsy supply includes $30B 2Y FRN Note and $70B 5Y Notes.
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