- China income growth in 2022 fell well short of that in 2021, back at COVID (2020) levels
- China's National People's Congress begins later this week - stockmarket likely underpinned
- Oil - further signs of rebounding demand in China
- Bank of England speakers Tuesday, 28 February 2023: Cunliffe, Pill, Mann
- BOJ nominee Uchida sees no pressing need to revise the govt - BOJ joint statement
- JP Morgan are wary of further USD strength ahead of the March FOMC meeting
- PBOC sets USD/ CNY mid-point today at 6.9519 (vs. estimate at 6.9515)
- BOJ dep gov nominee forecasts Japan CPI below 2% in the middle of fiscal year 2023
- More Australian data: Q4 net exports are 1.1% of GDP (vs. expected +1.3%)
- Australian data - January Retail Sales 1.9% m/m (expected +1.5%)
- Australian data - January Private Sector Credit +0.4% m/m (expected +0.4%)
- New Zealand business confidence February -43.3% (prior -52%)
- Japan Industrial Production, preliminary for January -4.6% m/m (expected -2.9%)
- Japan data - January retail sales +1.9% m/m (expected +0.4%) & +6.3% y/y (expected +4.0%)
- Australia weekly consumer confidence 80.0 (down from 80.4 the previous week)
- Eurozone inflation data for February due this week - preview (&what markets will focus on)
- More from Morgan Stanley - favouring further upside for the US dollar (the why is a doozy)
- MUFG expect the Bank of Japan to abandon YCC by July 2023 - but here is the risk
- US to eliminate TikTok use by Federal agencies
- Forexlive Americas FX news wrap: Cable makes a strong move higher
- Goldman Sachs 3 month view on EUR/USD is to target 1.02
- Trade ideas thread - Tuesday, 28 February 2023
Major FX remained in subdued ranges for the session.
Japanese retail sales for January surprised to the topside while industrial output missed badly to the downside.
- Retail sales y/y came in at its 11th consecutive monthly rise. This is encouraging news for the BOJ. The but is of course (see next point) ...
- Industrial production came in at its worst in eight months. Cars, vehicle parts and chip making machinery led the fall. While weaker global demand was cited the result does highlight the difficulties the Bank of Japan will face in cutting back easing. Incoming Bank of Japan Governor Ueda will tread carefully given the mixed messages economic indicators are sending.
Data from Australia showed retail sales in January rising better than expected m/m. The "but" on this is that over the past quarter or so there has been barely much growth in this indicator at all. Reserve Bank of Australia rate hikes are impacting the consumer. The Bank meet next Tuesday, March 7. A 25bp rate hike is as good as baked in.
ANZ’s New Zealand business survey showed confidence and activity barely improved. Inflation pressure remained intense.
The dip lower in the US dollar in overnight trade was reflected in a lower USD/CNY mid rate setting today from the People’s Bank of China compared with Monday’s.
Testimony in the Diet (Japanese parliament) continued today for the two BOJ Deputy Governor nominees. More in the bullets above, but as mentioned major FX didn’t shift around too much. This includes USD/JPY.
Asian equity markets:
Japan’s Nikkei 225 +0.33%
China’s Shanghai Composite +0.08%
Hong Kong’s Hang Seng +0.4%
South Korea’s KOSPI +0.9%
Australia’s S&P/ASX 200 +0.5%
The sharp downdraft in the Chinese yuan is likely to ease back heading into the National People's Congress this coming weekend.
