MNI China Daily Summary: Monday, July 1

MNI BRIEF: PBOC To Borrow CGBs In Response To Market Situation

MNI BRIEF: Caixin June Manufacturing PMI Hits Three-year High

MNI: PBOC Net Drains CNY48 Bln Via OMO Mon; Rates Unchanged

CHINA PBOC CONDUCTS CNY2 BILLION VIA 7-DAY REVERSE REPOS MON

HICP Steady As Expected; CPI Ticks Lower As State Data Indicated

MNI: GERMANY JUL CPI +2.2% Y/Y

German CPI / HICP due for release at 13:00BST / 14:00CET

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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Fed Rates Hold Bulk Of Prior Climb, Beige Book Leads Today's Commentary

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  • Fed Funds implied rates have dipped a little from overnight highs but hold the bulk of yesterday’s strong climb seen on the consumer confidence beat before following yields higher with low demand for auctions.
  • Cumulative cuts from 5.33% effective: 0.5bp Jun, 3bp Jul, 13bp Sep, 19bp Nov and 32bp Dec.
  • CPI releases overnight have seen a beat for Australian CPI in April whilst German regional prints point to a small miss or an in line reading for the national headline CPI released later today but with service inflation accelerating strongly.
  • The Fed’s Beige Book likely headlines today’s Fed commentary, with one area of focus on the latest tone around firms’ pricing power after noting a considerable weakening in recent months back in April.
  • NY Fed’s Williams speaking at a community services roundtable should limit mon pol content whilst Bostic (’24 voter) spoke multiple times last week noting he still doesn’t expect to cut rates before Q4 and that rates are restrictive but their efficacy could be weaker.
  • Williams’ speech at the Economic Club of NY tomorrow is likely more impactful.

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  • Fed Funds implied rates have dipped a little from overnight highs but hold the bulk of yesterday’s strong climb seen on the consumer confidence beat before following yields higher with low demand for auctions.
  • Cumulative cuts from 5.33% effective: 0.5bp Jun, 3bp Jul, 13bp Sep, 19bp Nov and 32bp Dec.
  • CPI releases overnight have seen a beat for Australian CPI in April whilst German regional prints point to a small miss or an in line reading for the national headline CPI released later today but with service inflation accelerating strongly.
  • The Fed’s Beige Book likely headlines today’s Fed commentary, with one area of focus on the latest tone around firms’ pricing power after noting a considerable weakening in recent months back in April.
  • NY Fed’s Williams speaking at a community services roundtable should limit mon pol content whilst Bostic (’24 voter) spoke multiple times last week noting he still doesn’t expect to cut rates before Q4 and that rates are restrictive but their efficacy could be weaker.
  • Williams’ speech at the Economic Club of NY tomorrow is likely more impactful.