MNI China Daily Summary: Wednesday, February 19

MNI BRIEF: China Jan Utilised FDI Lower Than Last Year

MNI BRIEF: China Unveils Plan To Attract Foreign Investors

MNI BRIEF: China To Ensure Credit Supply For Private Companies

MNI BRIEF: China Bond Connect Holdings Down In January

MNI: China Tier-one Housing Markets Likely To Stabilise

MNI: US MBA: MARKET COMPOSITE -6.6% SA THRU FEB 14 WK

EZ/UK T-Bill Calendar: 1/3/6-Month UKTB Auction on Friday

MNI: UK JAN CPI -0.1% M/M, +3% Y/Y

GERMANY: Economy Ministry Lowers 2025 Growth Forecast As Expected

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

GERMANY: Kukies Considers Potential Non-Implementation Of 2024 Suppl' Budget

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STIR: Fed Rates Hold More Hawkish Waller Impact, Daly Next Up

STIR
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  • Fed Funds implied rates have been buoyed overnight by Fed Governor Waller (permanent voter) late yesterday saying recent economic data support keeping rates on hold, but if inflation behaves as it did in 2024, policymakers can get back to cutting “at some point this year.”
  • That’s a hawkish turn compared to his Jan 16 comments which drew a notably dovish reaction with three or four rate cuts are possible in 2025 if the data cooperates.
  • Talking on CPI seasonality: “If this wintertime lull in progress is temporary, as it was last year, then further policy easing will be appropriate. But until that is clear, I favor holding the policy rate steady.”
  • Cumulative cuts from 4.33% effective: 0.5bp Mar, 5.5bp May, 14.5bp Jun, 19.5bp Jul, 29bp Sep and 40bp Dec.
  • Today's monetary policy focus is likely on SF Fed’s Daly (non-voter) at the American Bankers Association at 1020ET (text + Q&A). She said Feb 4 (pre payrolls and CPI) that the Fed is in a good position to wait and see when setting policy and we have to make sure we get inflation down. She doesn’t want to take pre-emptive action on Trump’s policies. 
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  • Fed Funds implied rates have been buoyed overnight by Fed Governor Waller (permanent voter) late yesterday saying recent economic data support keeping rates on hold, but if inflation behaves as it did in 2024, policymakers can get back to cutting “at some point this year.”
  • That’s a hawkish turn compared to his Jan 16 comments which drew a notably dovish reaction with three or four rate cuts are possible in 2025 if the data cooperates.
  • Talking on CPI seasonality: “If this wintertime lull in progress is temporary, as it was last year, then further policy easing will be appropriate. But until that is clear, I favor holding the policy rate steady.”
  • Cumulative cuts from 4.33% effective: 0.5bp Mar, 5.5bp May, 14.5bp Jun, 19.5bp Jul, 29bp Sep and 40bp Dec.
  • Today's monetary policy focus is likely on SF Fed’s Daly (non-voter) at the American Bankers Association at 1020ET (text + Q&A). She said Feb 4 (pre payrolls and CPI) that the Fed is in a good position to wait and see when setting policy and we have to make sure we get inflation down. She doesn’t want to take pre-emptive action on Trump’s policies. 
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