MNI China Daily Summary: Friday, December 13

MNI BRIEF: PBOC To Curb Any Yuan Overshot : PBOC Zou

MNI: GERMANY OCT EXPORTS -2.8% M/M (VS FCST -2.6%)

CHINA YTD NEW LOANS CNY17.1 TRLN VS MEDIAN CNY17.5 TRLN: PBOC

MNI: PBOC Net Injects CNY14.2 Bln via OMO Friday

MNI: PBOC Sets Yuan Parity Higher At 7.1876 Fri; -1.22% Y/Y

MNI: EUROZONE OCT IP +0% M/M, -1.2% Y/Y

MNI: SPAIN NOV HICP +0% M/M, +2.4% Y/Y

MNI: FRANCE NOV HICP -0.1% M/M, +1.7% 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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USD Index Rises to Week’s Best Levels, CHF Maintains Post-SNB Weakness

FOREX
  • US yields have risen on Thursday and despite broadly weak data in the US, the price components of the Philadelphia Fed Activity release offered one of the few hawkish aspects across the broader sweep data. Current period prices paid increased from 18.7 to 22.5 (close to 23.0 in Apr which was highest since Dec’23) and this may have assisted the stubborn bid for the greenback across the US session.
  • The yield move has underpinned a persistent move higher for USDJPY, which is closing back in on the 159.00 handle. An important resistance at 157.71, the May 29 high, has been breached and this confirms a resumption of the short-term bull cycle. Price has also pierced 158.21, 76.4% of the Apr 29 - May 3 sell-off and the clear break signals scope for a move towards 160.17, the Apr 29 high and a key resistance.
  • The key underperformer in G10 on Thursday has been the Swiss Franc following a moderately surprising quarter point rate cut from the SNB. EURCHF holds around 30 pips off the 0.9573 highs as we approach the APAC crossover.
  • While we pointed out this morning that EURCHF remains in a downtrend, we did note the short-term condition was oversold. A continuation of this technical correction might signal scope for an extension towards 0.9664, the 20-day EMA.
  • On the other end of the spectrum, NOK leads FX gains on the back of a hawkish Norges Bank decision. While the bank kept rates unchanged, the policy statement and accompanying rate path pointed to unchanged policy through to the end of 2024 - leaning against outside expectations for a rate cut as soon as September. EUR/NOK corrected lower in response, hitting the lowest levels since late January to expose next support at 11.2517 in the short-term, and the December/cycle low of 11.1760 further out.
  • UK retail sales on Friday precedes the plethora of flash European PMI data releases. Canada retail sales data also crosses, before US flash PMIs and existing home sales round off the week’s docket.
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