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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BONDS: NZGBS: Closed With A Modest Twist Steepening Ahead Of US Payrolls

BONDS
BulletMarketsFixed Income Bullets

NZGBs twist-steepened, with benchmark yields closing 1bp lower to 1bp higher, on a data-light session ahead of tonight’s release of US Nonfarm payrolls for December.

  • Nonfarm payrolls growth is seen at circa 160k in December as some recent distortions from hurricanes and strikes are in the rearview mirror and with a relatively narrow range to analyst estimates. The unemployment rate is broadly seen holding at 4.2%, although at an unrounded 4.246% in November, it wouldn’t surprise if it rounded to 4.3%. A ‘high’ of 4.3% would still be notable for a fresh recent high.
  • Swap rates closed 1-2bps lower, with a steeper 2s10s curve.
  • RBNZ dated OIS pricing closed flat to 4bp softer across meetings, with late 2025 leading. 51bps of easing is priced for February, with a cumulative 131bps by November 2025.
  • 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. Over the period, NZ saw a decline of 36bps, Australia softened by 30bps, and Canada eased by 19bps.
  • The local calendar will see Building Permits and Filled Jobs on tap on Monday.
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NZGBs twist-steepened, with benchmark yields closing 1bp lower to 1bp higher, on a data-light session ahead of tonight’s release of US Nonfarm payrolls for December.

  • Nonfarm payrolls growth is seen at circa 160k in December as some recent distortions from hurricanes and strikes are in the rearview mirror and with a relatively narrow range to analyst estimates. The unemployment rate is broadly seen holding at 4.2%, although at an unrounded 4.246% in November, it wouldn’t surprise if it rounded to 4.3%. A ‘high’ of 4.3% would still be notable for a fresh recent high.
  • Swap rates closed 1-2bps lower, with a steeper 2s10s curve.
  • RBNZ dated OIS pricing closed flat to 4bp softer across meetings, with late 2025 leading. 51bps of easing is priced for February, with a cumulative 131bps by November 2025.
  • 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. Over the period, NZ saw a decline of 36bps, Australia softened by 30bps, and Canada eased by 19bps.
  • The local calendar will see Building Permits and Filled Jobs on tap on Monday.