MNI China Daily Summary: Tuesday, December 10

MNI BRIEF: China Nov Exports Slows, Imports Slide

MNI BRIEF: China Crude Oil Imports Accelerate In November

CHINA NOV EXPORTS +6.7% Y/Y VS MEDIAN +8.9% Y/Y: CUSTOMS

MNI: CHINA YTD EXPORTS +6.7% Y/Y IN YUAN TERM: CUSTOMS

MNI: PBOC Net Injects CNY90.3 Bln via OMO Tuesday

US NFIB NOV SMALL BUSINESS INDEX 101.7

MNI: GERMAN NOV CPI +2.2 % Y/Y

MNI: NORWAY NOV CORE CPI +0.1% M/M, +3% 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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FOREX: Renewed Political Risk Premium Presses EUR/GBP to Multi-year Low

FOREX
  • European markets have been left reeling by a bruising set of European Parliamentary election results, with right-wing parties across the continent surging ahead in the polls and triggering a wholly unexpected election call from the French President Macron. As such, markets trade with a heavy dose of political risk premium, tipping yields to rise across Europe and weighing on the single currency.  
  • EUR/GBP has cracked lower, breaking support to print a new multi-year low at 0.8453 and putting EUR/USD on course for a test of last month's low. The pair's two-day decline now amounts to close to 150 pips after Friday's solid NFP release, opening 1.0724 as the next key support.
  • Front-end vols are well bid ahead of a tricky week to navigate for markets. The Fed and BoJ decisions as well as US CPI should keep markets busy as curves trade steeper in the US and Fed pricing for 2024 remains toward the tighter end of the series.
  • Antipodean currencies outperform, with AUD, NZD firming. CFTC CoT data from Friday shows markets built the NZD net position in the latest week, swinging to a net long of 13.2% of OI, second only to GBP in G10 currencies. 
  • The calendar ahead is typically light for a Monday, with just the NY Fed's inflation expectations survey due. As a result, the central bank speaker slate should be of more consequence, with ECB's Holzmann and Nagel appearing later today. Holzmann was reportedly the only dissenter at the ECB's decision to cut rates last week, meaning his appearance today could carry more weight.
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