Expect more Chinese stimulus

9 December, 2015

A year of stimulus, interest rate cuts and most recently devaluations to its currency is finally having the desired effect on inflation in China as CPI data came in at 1.5%, slightly higher than the 1.4% expected. There are still wide spread deflationary pressures for producers who see continue to see prices tumble with PPI coming in as expected at -5.9%, but for consumers the stimulus measures have had a greater impact showing prices rising. However, for the PBOC inflation is still running well below target which means there remains plenty of room for further stimulus measures. Ever since the Yuan was added to the IMF’s reserve currency basket we’ve seen the fixing rate lowered in the last four days in a row and we’re likely to see a continuation of the renminbi’s devaluation. The data saw a mixed reaction from Asian markets overnight but crude prices are seeing a bounce with Brent finding major support at the $40 a barrel level and so this morning European indices are looking to commence trading in the black.

Yesterday’s UK manufacturing data was softer and caused GBPUSD to dip back below the 1.5000 level however this didn’t last very long with cable trading back to 1.5035 at the time of writing. The remainder of the day is quiet on the economic data front, but later this evening the RBNZ makes its latest interest rate decision where they are expected to cut rates from 2.75% to 2.50%, so the 0.6600 level on NZDUSD will be watched.


Source link  
All Eyes on Central Banks

Markets were, for the most part, little changed on Wednesday as traders waited for today’s Bank of Japan and ECB rate decisions. Earlier today...

Dollar Bears

UK Consumer Price Index (CPI) data was released on Tuesday showing inflation easing for the first time in nearly 10 months, retreating from the near 4-year high touched in May...

More Record Highs for Equities?

Early indications from Asia this morning are pointing towards a strong day for global equities, continuing the momentum from last week...


US Data brings on USD bulls

U.S. job growth surged more than expected in June and employers increased hours for workers, with signs of a labor market strengthening that is likely...

Biggest Quarterly Drop in 7 Years

USD recovered marginally on Friday, but had its biggest quarterly decline against several currencies in nearly 7 years following hawkish signals...

Markets look to Central Bankers

Asian Equities traded higher on Tuesday approaching near two-year highs on Tuesday as USD strength helped exporters...


Global Economic Optimism Continues

Global equities moved higher on Monday as optimism continued to improve on global economic growth. However, USD...

BOJ Monetary Policy Remains Steady

The Bank of Japan maintained their monetary policy on Friday whilst upgrading their assessment of private consumption...

Final Confirmation for a June Rate Hike

The crucial US labour market data for May will be released today, June 2nd at 13:30 BST. It includes non-farm payrolls...

  


Share: