General trend
- Will the current pace of Aussie job gains be sustained going forward?
- RBA Gov Lowe commented on the 3 options for the central bank’s bond purchase program, also said would like to see full employment and 4.0% wage growth.
- Australia Treasury issued budget statement: Cut GDP forecasts, sees inflation within the RBA’s 2-3% target, sees FY24/25 wage growth above 3%.
- Australia New South Wales (highest population state) reports record 1,742 virus cases.
- Commodity currencies trade generally lower amid Australia events and US Fed.
- Bank of Korea (BOK) Gov held briefing on H2 CPI.
- Precious metals have remained higher in Asia.
- US equity FUTs trade slightly higher after gains on Wed.
- Nikkei 225 has remained higher by >1%.
- Hang Seng has remained lower; TECH index hit a fresh record low; Property index traded slightly higher during the morning session, China officials said to have met with certain property developers on Wed.
- Shanghai Composite traded slightly higher during the morning session (+0.3%).
- S&P ASX 200 has remained lower following the dip at the open; CSL weighed on the healthcare index; Resources and Energy indices also declined.
- Singapore property developers declined modestly on real estate curbs.
- Central banks in Taiwan, Philippines and Indonesia are expected to leave rates unchanged later today.
- China’s Commerce Ministry (MOFCOM) sometimes holds weekly news conferences on Thurs.
- BOJ decision is due on Fri (Dec 17th)
- Australia to release the annual weight update of the CPI and Living Cost Indexes on Fri.
- Companies due to report during the NY morning include Accenture, Jabil.
Headlines/Economic data
Australia/New Zealand
- ASX 200 opened +0.1%.
- (AU) Reserve Bank of Australia (RBA) Gov Lowe: Third option is to halt bond purchases in Feb if economic data better than expected; Underlying inflation expected to hit 2.5% during 2023; Conditions for rate hike will not be met in 2022- Speech “The RBA and the Australian Economy “.
- (AU) AUSTRALIA NOV EMPLOYMENT CHANGE: +366.1K V +200.0KE; UNEMPLOYMENT RATE: 4.6% V 5.0%E.
- (AU) AUSTRALIA DEC CONSUMER INFLATION EXPECTATION: 4.8% V 4.6% PRIOR (9-year high).
- (AU) Australia Treasurer Frydenberg issues Mid-Year Economic and Fiscal Outlook (MYEFO): Cuts GDP outlooks, raises CPI outlook, budget to remain in decreasing deficit for next few years.
- (NZ) NEW ZEALAND Q3 GDP Q/Q: -3.7% V -4.1%E; Y/Y: -0.3% V -1.4%E.
- QAN.AU Guides H1 (A$) EBITDA -300M to -250M, underlying EBIT great than -1.1B.
- (AU) Australia Council of Financial Regulators (CFR) Quarterly Statement: Key items of discussion included housing market risks and the Council’s work on payments and crypto-assets, cyber security and the financial risks related to climate change.
- WSA.AU To be acquired by IGO at A$3.36/shr for A$1.1B.
- MSB.AU Announces FDAs OTAT agree to Primary Endpoint for Back Pain, to conduct an additional US Phase 3 trial which may support submissions for potential approval in both the US and EU.
Japan
- Nikkei 225 opened +1.4%.
- (JP) JAPAN DEC PRELIMINARY PMI MANUFACTURING: 54.2 V 54.5 PRIOR (11th consecutive expansion).
- (JP) Japan Econ Min Yamagiwa: No need to change GDP forecast after overstated construction data.
- (JP) Japan Nov Trade Balance: -¥954.8B v -¥600.3Be; Adj Trade Balance: -¥486.8B v -¥302.8Be.
- (JP) Japan Investors Net Buying of Foreign Bonds: +¥457.0B v -¥1.18T prior; Foreign Net Buying of Japan Stocks: -¥602.9B v +¥2.01T prior.
- (JP) Japan MoF sells ¥1.2T v ¥1.2T indicated in 0.500% 20-year JGBs, Avg Yield: 0.4520% v 0.4640% prior, bid-to-cover: 3.66x v 3.78x prior.
Korea
- Kospi opened +0.8%.
- (KR) Bank of Korea (BOK) Gov Lee: See CPI staying above 2% for quite some time amid a solid economic recovery and increasing price pressures from global supply bottlenecks – bi-annual inflation review.
- (KR) South Korea Fin Min Hong: Targeting low 3.0% GDP growth in 2022.
- (KR) Bank of Korea (BOK): $60B currency swap agreement with US to expire on Dec 31st, as scheduled; financial and economic situations at home and abroad remain stable.
- (KR) South Korea PM announces increased COVID restrictions, re-implements 9PM curfew on all restaurants and businesses, limits private gatherings to 4 people.
China/Hong Kong
- Hang Seng opened -0.6%; Shanghai Composite opened 0.0%.
- (CN) China Govt said to be increasing the number of minority stakes it is taking in private companies, especially those that have large amounts of key data – press.
- (HK) Hong Kong Monetary Authority (HKMA): Money markets in Hong Kong continue to operate smoothly.
- (CN) China PBOC sets Yuan reference rate: 6.3637 v 6.3716 prior.
- (CN) China PBOC Open Market Operation (OMO): Sells CNY10B in 7-day reverse repos v CNY10B prior; Net CNY0B v Net CNY0B prior.
- Another press report saying China loan prime rates (LPRs) may be lowered during Dec, cites analysts – Chinese press.
- (CN) China State Planner (NDRC): Approved CNY261.5B in investments during Nov; Has created list of Special bond funded projects in 2022.
North America
- In Oct Japan Total Holdings of US Treasuries: $1.32T v $1.30T prior, China Total holding of US Treasuries: $1.065T v $1.05B prior.
- TCOM Reports Q3 (CNY) 0.81 v 2.32 y/y, Rev 5.3B v 5.5B y/y.
- (US) FOMC LEAVES TARGET RANGE UNCHANGED BETWEEN 0.00-0.25% RANGE; AS EXPECTED; DOUBLES PACE OF TAPER TO $30B PER MONTH; OFFICIALS SEE THREE RATE HIKES IN 2022 – Officials see three rate increases in 2022, three more hikes in 2023.
- (US) Fed Chair Powell: Economic developments and outlook warranted faster bond taper; Elevated inflation was reason for accelerating taper – post rate decision press conference.
Europe
- (FR) France Pres Macron: It’s entirely possible France introduces mandatory COVID vaccinations.
Levels as of 00:15ET
- Hang Seng -0.6%; Shanghai Composite +0.3%; Kospi +0.2%; Nikkei225 +1.9%; ASX 200 -0.4%.
- Equity Futures: S&P500 +0.2%; Nasdaq100 +0.2%, Dax +0.2%; FTSE100 +0.1%.
- EUR 1.1299-1.1281; JPY 114.25-114.00; AUD 0.7181-0.7146; NZD 0.6791-0.6758.
- Commodity Futures: Gold +1.0% at $1,782/oz; Crude Oil +1.0% at $71.55/brl; Copper -0.1% at $4.24/lb.
