MNI China Daily Summary: Friday, December 27

MNI BRIEF: BOJ: Rate Hike Chance Nearing; Mull Patiently

MNI: PBOC Net Injects CNY6.2 Bln via OMO Friday

MNI: PBOC Sets Yuan Parity Lower At 7.1893 Fri; -2.12% Y/Y

MNI JAPAN NOV FACTORY OUTPUT DROPS 2.3% M/M; OCT +2.8%

MNI JAPAN NOV JOBLESS RATE AT 2.5%, UNCHANGED FROM OCT

US EIA:NAT GAS STORAGE -93 BCF TO 3,529 BCF DEC 27 WK

MNI: US JOBLESS CLAIMS -1K TO 219K IN DEC 21 WK

MNI: US REDBOOK: DEC STORE SALES +5.0% V YR AGO MO

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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STIR: Just Over 115bp Of ECB Cuts Priced Through '25

STIR
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The market-implied ECB rate cutting cycle is little changed.

  • 27.5bp of cuts are priced for January, with 60.5bp of easing showing through March, 100.5bp priced through June and 116bp priced through ’25.
  • Euribor futures are flat to +1.0.
  • The ECB remains geared towards further easing.
  • Sticky services inflation pressures continue to present the most meaningful hawkish risk, although that area of worry has been apparent through the early stages of the Bank’s easing cycle.
  • The Bank has still decided to act as the evolution of wider inflationary dynamics has provided it with greater confidence that inflation is moving back to target.
  • Growth considerations also factored into recent policy decisions, with a disappointing run of PMI data seen.
  • Meanwhile, the threat of tariffs from incoming U.S. President Trump presents a meaningful external risk.
  • Little of note on the G10 macro calendar today, which will leave participants focused on news flow and cross-market moves during holiday period-thinned trade.

ECB Meeting

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The market-implied ECB rate cutting cycle is little changed.

  • 27.5bp of cuts are priced for January, with 60.5bp of easing showing through March, 100.5bp priced through June and 116bp priced through ’25.
  • Euribor futures are flat to +1.0.
  • The ECB remains geared towards further easing.
  • Sticky services inflation pressures continue to present the most meaningful hawkish risk, although that area of worry has been apparent through the early stages of the Bank’s easing cycle.
  • The Bank has still decided to act as the evolution of wider inflationary dynamics has provided it with greater confidence that inflation is moving back to target.
  • Growth considerations also factored into recent policy decisions, with a disappointing run of PMI data seen.
  • Meanwhile, the threat of tariffs from incoming U.S. President Trump presents a meaningful external risk.
  • Little of note on the G10 macro calendar today, which will leave participants focused on news flow and cross-market moves during holiday period-thinned trade.

ECB Meeting

Keep reading...Show less