MNI China Daily Summary: Wednesday, October 16

MNI: ITALY FINAL HICP +1.2% M/M, +0.7%Y/Y

MNI BRIEF: BOJ's Adachi Sees Conditions For Normalisation

MNI: PBOC Net Injects CNY581.4 Bln via OMO Wednesday

CHINA PBOC CONDUCTS CNY642.4 BLN VIA 7-DAY REVERSE REPOS WEDS

MNI: PBOC Sets Yuan Parity Higher At 7.1191 Weds; +2.66% Y/Y

MNI: UK SEP OUTPUT PPI -0.5% M/M, -0.7% Y/Y

MNI: UK SEP CPI +0% M/M, +1.7% Y/Y

Japan Aug Machine Orders -1.9% M/M

CANADA: Politics Week: Trudeau Faces More Pressure To Resign

CANADA: Politics Week: Parliament Opens With Early Election Threats

AUSTRALIA: Albanese Lines Up Budget for May Election

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JGBS: Subdued Session, BoJ Adachi’s Message In Line With Gov. & Dep. Gov.

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JGB futures are holding overnight gains, +20 compared to settlement levels.

  • Outside of the previously outlined core machine orders data, the market has had a speech from BoJ board member Adachi to digest. “It is appropriate for the BoJ to raise the policy rate gradually,” Adachi told business leaders in Takamatsu City. However, Adachi did not elaborate on when and how the Bank would raise the policy interest rate.
  • His stance is similar to those of Governor Ueda and Deputy Governor Uchida, as the BoJ is still emphasising gradual rate hikes with a view to realising its economic outlook.
  • Cash US tsys are little changed in today’s Asia-Pac session. Today’s US calendar includes September import/export prices - which feed into the Fed's preferred PCE inflation gauge - and a Fox interview with Vice President Harris.
  • Cash JGBs are flat to 1.5bps richer across benchmarks beyond the 1-year (+3.7bps). The benchmark 10-year yield is 1.2bps lower at 0.962%.
  • Swap rates are flat to 1bp lower. 
  • Tomorrow, the local calendar will see Trade Balance data and the Tertiary Industry Index alongside 1-year supply. The MoF will also conduct a Liquidity Enhancement Auction covering 15.5-39-year OTR JGBs.
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JGB futures are holding overnight gains, +20 compared to settlement levels.

  • Outside of the previously outlined core machine orders data, the market has had a speech from BoJ board member Adachi to digest. “It is appropriate for the BoJ to raise the policy rate gradually,” Adachi told business leaders in Takamatsu City. However, Adachi did not elaborate on when and how the Bank would raise the policy interest rate.
  • His stance is similar to those of Governor Ueda and Deputy Governor Uchida, as the BoJ is still emphasising gradual rate hikes with a view to realising its economic outlook.
  • Cash US tsys are little changed in today’s Asia-Pac session. Today’s US calendar includes September import/export prices - which feed into the Fed's preferred PCE inflation gauge - and a Fox interview with Vice President Harris.
  • Cash JGBs are flat to 1.5bps richer across benchmarks beyond the 1-year (+3.7bps). The benchmark 10-year yield is 1.2bps lower at 0.962%.
  • Swap rates are flat to 1bp lower. 
  • Tomorrow, the local calendar will see Trade Balance data and the Tertiary Industry Index alongside 1-year supply. The MoF will also conduct a Liquidity Enhancement Auction covering 15.5-39-year OTR JGBs.