Morning wrap (11.12.2023)

7:39 AM 11 December 2023
  • Indices from Asia-Pacific traded mixed today - Nikkei jumped 1.5%, S&P/ASX 200 traded flat, Kospi gained 0.3% and Nifty 50 added 0.1%. Indices from China traded 0.1-0.4% lower
  • US and European index futures trade slightly below Friday's cash closing levels
  • Chinese CPI inflation dropped from -0.2% to -0.5% YoY in November (exp. -0.2% YoY) while PPI inflation dropped from -2.6% to -3.0% YoY (exp. -2.8% YoY)
  • Lower-than-expected inflation reading is putting pressure on Chinese yuan, with USDCNH rising 0.2% to the highest level in 3 weeks
  • Japanese yen pulls back, with USDJPY trading 0.4% higher on the day. According to Reuters report, BoJ Governor Ueda has no intention to signal anything on timing of policy change
  • Bank of America said that there is a risk of core inflation in the US remaining higher and stickier than headline inflation into 2024, with base effects from energy prices fading
  • Bank of America also said that current inflation developments support the beginning of rate cuts in Europe in March 2024
  • Goldman Sachs now expects first FOMC rate cut to be delivered in Q3 2024, amid surprise on inflation progress
  • Fire broke out at Birjand refinery in eastern Iran over the weekend, leading to a loss of 1.5 million liters of fuel
  • Cryptocurrencies are taking a hit at the beginning of a new week - Bitcoin drops 4.4%, Dogecoin trades 5% lower and Ethereum slumps 5.2%
  • Precious metals trade mixed - gold drops 0.2%, silver trades flat while platinum and palladium gain 0.4% each
  • Energy commodities trade mixed as well - oil gains 0.8% while US natural gas prices are down almost 5% amid above-average temperatures
  • EUR and CHF are the best performing G10 currencies while JPY and AUD lag the most

USDCNH climbs to 3-week high after a lower-than-expected Chinese inflation data for November. Pair is testing resistance zone in the 7.2050 area, marked with previous price reactions and 200-sessio moving average (purple line). Source: xStation5

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