MNI: POWELL SAYS PCE INFLATION CAME IN LINE WITH EXPECTATIONS

MNI China Daily Summary: Friday, March 29

MNI: PBOC Injects Net CNY148 Bln Via OMO Fri; Rates Unchanged

MNI: PBOC Sets Yuan Parity Higher At 7.0950 Fri; -4.70% Y/Y

CHINA PBOC INJECTS CNY150 BILLION VIA 7-DAY REVERSE REPOS FRI

CHINA SETS YUAN CENTRAL PARITY AT 7.0950 FRI VS 7.0948

MNI: US FEB PERSONAL INCOME +0.3%; NOM PCE +0.8%

HICP Tracking at 2.4%Y/Y - One tenth below consensus

HICP 2 tenths softer than expected, but partly on clothing prices

MNI BRIEF: Poilievre Calls QE 'Scam' And Would Limit BOC Remit

MNI: Growth Drag From Net Zero Carbon Goal Can Be Offset-OECD

MNI BRIEF: Lawmakers Signal Tough Hearing For BOC's Macklem

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Yuan Sees Limited Reaction To Strong Data

CNH

Data from China was broadly positive: GDP 2.3% in 2020, and 6.5% Y/Y in Q4. Fixed asset investment increased 2.9%, industrial production grew 2.8% but retail sales shrank 3.9% in 2020 with most of the decline coming in the first half of the year.

  • While the data is positive, ING cautions against categorizing this as a full scale recovery: "External demand has not yet fully recovered. This is a big hurdle for a full recovery of China's industrial production, especially for smaller manufacturers. The pandemic has resulted in a pause in international travel. And with rapid increases in Covid cases in the US and Europe, industries related to exports will continue to be in a difficult situation."
  • ING also notes political risks to China as a headwind: "We expect the newly elected US government will continue most of the current policies on China, at least for the first quarter. That means tariffs and technology measures on China will still be in place."
  • USD/CNH saw limited reaction to the data, last down 5 pips at 6.4842, off session highs of 6.4888.
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