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China Outlook: Construction and Trade Headwinds v Policy Stimulus
December 17, 2024 11:00 AM UTC
We do see a package of stimulative fiscal policy measures for 2025 including Yuan1-3trn infrastructure spending; Yuan1trn funds to buy completed homes for affordable housing and Yuan1trn capital injection to the big six state banks. Some modest measures for low-income households and to boost soci
This week's five highlights
December 6, 2024 10:00 AM UTC
U.S. November Employment To Rebound from October's hurricanes and strike
U.S. Initial Claims up but still low, narrowing in Trade Deficit may be temporary
U.S. November ADP Employment Mostly strong despite weak manufacturing
USD/JPY Chops Around
A Political Crisis But Not (Yet) a Fiscal One for France
Preview: Due December 16 - U.S. December S&P PMIs - Correcting November improvements
December 4, 2024 5:09 PM UTC
We expect December’s S and P PMIs to show a marginal slippage, manufacturing to 49.0 from November’s 5-month high of 49.7 and services to a still healthy 55.5 from 56.1, which was the highest monthly reading since March 2022.
Trump Deregulation and U.S. Financial Stability
November 26, 2024 10:05 AM UTC
Regional banks will be the main beneficiaries from a further watering down or postponement (that is likely under the Trump administration) of the proposed capital increase under the Basel endgame. Combined with laxer M&A rules for bank takeover, this could help lending and credit growth for the U.
Preview: Due December 23 - Canada October GDP - Strongest rise since April
December 20, 2024 2:17 PM UTC
We expect Canadian GDP to see a 0.2% increase in October, slightly above a preliminary 0.1% estimate made with September’s report and the strongest increase since April. This would suggest Bank of Canada easing is starting to have some impact.
U.S. November Core PCE Prices significantly softer than Core CPI
December 20, 2024 1:59 PM UTC
November PCE prices at 0.1% overall and core has sharply underperformed gains of 0.3% in both overall and core CPI, easing some of the inflationary concerns generated by two straight gains of 0.3% in September and October core PCE prices. Gains of 0.3% in personal income and 0.4% in spending are als
Surprising Move: CBR Held Key Rate at 21% Despite Surging Inflation
December 20, 2024 1:39 PM UTC
Bottom Line: Despite expectations, Central Bank of Russia (CBR) announced on December 20 that it held the key rate constant at 21%. The CBR emphasized in its statement that monetary conditions tightened more significantly than envisaged by the October key rate decision, and it would continue to eval
Bank Indonesia Holds Rate to Support IDR
December 20, 2024 12:06 PM UTC
Bank Indonesia held its key interest rate at 6% in its December meeting. The decision to hold rates steady is primarily influenced by the need to stabilize the Indonesian rupiah. Inflation remains within target, and GDP growth forecasts are steady. Future rate cuts depend on US Federal Reserve actio
EMFX Outlook: Hit From Tariffs, Before Divergence
December 20, 2024 10:00 AM UTC
· EM currencies on a spot basis will remain on the defensive in H1 2025, as we see the U.S. threatening and then introducing tariffs on China imports – 30% against the current average of 20%. China’s response will likely include a Yuan (CNY) depreciation to the 7.65 area on USD/CN
DM FX Outlook: USD to edge lower despite high yields
December 20, 2024 8:28 AM UTC
· Bottom Line: Recent strong US data has bolstered the USD, with the Trump election victory also supportive due to expectations of tax cuts and tariffs which are seen leading to less Fed easing than previously expected. While we still see the USD weakening through 2025 as Fed easing red
Asia Summary and Highlights 20 December
December 20, 2024 5:28 AM UTC
Asia Session
On Friday, we started the day with some verbal intervention from Japan finance minister Kato. The jawboning came with nothing new but is enough to curb the latest rally in USD/JPY. Moreover, the Japan November National headline CPI came in stronger than prior month at +2.9%, ex fresh foo