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Yen Unfazed By Inflation Data, Yuan Takes Hit From Shanghai COVID Matters

FOREX

It has been a directionless start to the Asia-Pac session for G10 FX space, with the yen paying little attention to domestic CPI data. Core consumer prices grew 2.1% Y/Y, printing marginally above BBG median estimate (+2.0%), but this outturn is not expected to encourage the BoJ to change its policy stance in the near term.

  • Offshore yuan has weakened as Shanghai found the first COVID-19 cases in six days, while the total case count rose to 858. Spot USD/CNH has added ~100 pips on these headlines.
  • Reminder that the monthly fixing of China's 1- & 5-Year Loan Prime Rates (LPR) is eyed today, with some looking for cuts given the headwinds faced by the Chinese economy.
  • UK retail sales & EZ consumer confidence will take focus later in the day. Comments are due from ECB's Muller, Kazaks, Simkus, Centeno, de Cos as well as BoE's Pill.
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It has been a directionless start to the Asia-Pac session for G10 FX space, with the yen paying little attention to domestic CPI data. Core consumer prices grew 2.1% Y/Y, printing marginally above BBG median estimate (+2.0%), but this outturn is not expected to encourage the BoJ to change its policy stance in the near term.

  • Offshore yuan has weakened as Shanghai found the first COVID-19 cases in six days, while the total case count rose to 858. Spot USD/CNH has added ~100 pips on these headlines.
  • Reminder that the monthly fixing of China's 1- & 5-Year Loan Prime Rates (LPR) is eyed today, with some looking for cuts given the headwinds faced by the Chinese economy.
  • UK retail sales & EZ consumer confidence will take focus later in the day. Comments are due from ECB's Muller, Kazaks, Simkus, Centeno, de Cos as well as BoE's Pill.