MNI China Daily Summary: Friday, January 10

MNI BRIEF: China To Adopt Very Proactive Fiscal Policy-Offical

CANADA LIBERAL LEADERHIP VOTE TO REPLACE TRUDEAU SET FOR MAR 9

MNI BRIEF: PBOC Suspends Bonds Trades As Yields Drop

MNI: PBOC Net Drains CNY14.8 Bln via OMO Friday

MNI: PBOC Sets Yuan Parity Higher At 7.1891 Fri; -2.36% Y/Y

MNI: FRANCE NOV INDUSTRIAL PRODUCTION +0.2% M/M, -1.1% Y/Y

MNI: FRANCE NOV CONSUMER SPENDING +0.3% M/M, +0.3% Y/Y

MNI: NORWAY DEC CPI -0.1% M/M, +2.2% 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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MNI Asia Pac Weekly Macro Wrap:

A weekly wrap of some of the key events and macro themes for the Asia Pac region.
USCentral Bank NewsHomepageFederal ReserveAPACJapanAustraliaNew ZealandStoryChinaNorth AmericaMarkets

Executive Summary:

  • JAPAN
  • Japan data has surprised positively this past week in terms of labour earnings and real household spending. However, the outcomes have not been enough to shift market pricing around the BOJ January meeting, where hike odds are quite low. 
     
  • AUSTRALIA
  • While November headline inflation picked up 0.2pp to 2.3% y/y, the focus is on trimmed mean given current state & federal electricity rebates and this underlying measure eased 0.3pp to 3.2%, where it was in September. It is too early to tell though if monthly inflation is trending lower again, thus attention will be firmly on Q4 CPI on January 29.
  • Retail sales showed a broad based increase in November boosted by Black Friday discounting.
  • Housing affordability is at extremely low levels but appears to have stabilised but to materially improve it will need both lower rates and house prices.
     
  • NEW ZEALAND
  • Housing affordability has begun to improve, which should help the market recover going forward.
     
  • SHORT TERM RATES
  • In the $-bloc, rate expectations through July 2025 have softened significantly over the past month, with the exception of the US, where expectations remained largely unchanged.
     
  • CHINA
  • China headline inflation data painted a soft picture for the domestic economy this week, although the improvement in the core print suggests some modest improvement. Late in the week the PBoC stepped up efforts to curb lower onshore yields, while the defence of the yuan continued amid broader USD gains. 
     
  • ASIA
  • Thai headline inflation returned to the target band in December but with core at 0.8% y/y it remains very low. For now the Bank of Thailand wants to keep policy flexibility given the high degree of uncertainty.
     
  • ASIA EQUITY FLOWS
  • South Korean equities benefitted from the US looking to impose new restrictions on AI chip exports, however this news hurt Taiwan equities, which saw large outflows.
     
  • GLOBAL
  • Global IP and trade growth was fairly steady over 2024 and that trend continued in October and the manufacturing PMI is signalling that that remained the case going into year end.

    PLEASE FIND THE FULL REPORT HERE: weekly macro round up (January 10 2025) .pdf 
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Executive Summary:

  • JAPAN
  • Japan data has surprised positively this past week in terms of labour earnings and real household spending. However, the outcomes have not been enough to shift market pricing around the BOJ January meeting, where hike odds are quite low. 
     
  • AUSTRALIA
  • While November headline inflation picked up 0.2pp to 2.3% y/y, the focus is on trimmed mean given current state & federal electricity rebates and this underlying measure eased 0.3pp to 3.2%, where it was in September. It is too early to tell though if monthly inflation is trending lower again, thus attention will be firmly on Q4 CPI on January 29.
  • Retail sales showed a broad based increase in November boosted by Black Friday discounting.
  • Housing affordability is at extremely low levels but appears to have stabilised but to materially improve it will need both lower rates and house prices.
     
  • NEW ZEALAND
  • Housing affordability has begun to improve, which should help the market recover going forward.
     
  • SHORT TERM RATES
  • In the $-bloc, rate expectations through July 2025 have softened significantly over the past month, with the exception of the US, where expectations remained largely unchanged.
     
  • CHINA
  • China headline inflation data painted a soft picture for the domestic economy this week, although the improvement in the core print suggests some modest improvement. Late in the week the PBoC stepped up efforts to curb lower onshore yields, while the defence of the yuan continued amid broader USD gains. 
     
  • ASIA
  • Thai headline inflation returned to the target band in December but with core at 0.8% y/y it remains very low. For now the Bank of Thailand wants to keep policy flexibility given the high degree of uncertainty.
     
  • ASIA EQUITY FLOWS
  • South Korean equities benefitted from the US looking to impose new restrictions on AI chip exports, however this news hurt Taiwan equities, which saw large outflows.
     
  • GLOBAL
  • Global IP and trade growth was fairly steady over 2024 and that trend continued in October and the manufacturing PMI is signalling that that remained the case going into year end.

    PLEASE FIND THE FULL REPORT HERE: weekly macro round up (January 10 2025) .pdf