- Japan yen intervention official says will take appropriate action against excess FX moves
- China one year bond yield drops to 1%, first time in 15 years
- New Zealand credit card spending -3.2% y/y in November (prior +0.3%)
- South Korea to ease FX regulations to improve liquidity conditions
- U.S. authorities may ban Chinese-made TP-Link internet routers, used in millions of homes
- PBOC sets USD/ CNY reference rate for today at 7.1901 (vs. estimate at 7.3086)
- USD/JPY (finally) responds (a little) to intervention comments
- PBOC sets 1 year Loan Prime Rate (LPR) at 3.1% and 5-year at 3.6%, both unchanged
- Japan fin min Kato with verbal intervention on JPY - recent one-side, sharp yen moves
- Australian November data - Private Sector Credit +0.5% m/m (expected +0.5%)
- People's Bank of China Loan Prime Rate (LPR) setting due today - why its less relevant
- USD/JPY hits a 5-month high just shy of 158.00
- Largest construction machinery firm fears Trump tariffs - our business based on free trade
- US Bill to avert a government shutdown has failed
- Japan November headline CPI +2.9% (expected +2.9%, prior 2.3%)
- The Federal Reserve saved US equities from a bubble (but there's still a chance!)
- US inflation (PCE) data due Friday - here are the critical ranges to watch
- New Zealand exports in November higher than in October (imports lower)
- Forexlive Americas FX news wrap 19 Dec: BOE keeps rate unchanged but is more dovish
- Federal Reserve monetary policy has entered a new phase - may be quite different
- US broader indices give up gains and close lower on the day
- New Zealand December consumer confidence jumps into optimism! 100.2 (prior 99.8)
- Trade ideas thread - Friday, 20 December, insightful charts, technical analysis, ideas
From Japan today we had inflation data for November. Inflation rates moved solidly higher, well above the Bank of Japan 2% target level, above expectations, and above October levels. The “core-core” inflation rate, which strips out prices of fresh food and energy and is the closest to the US measure of core inflation moved to its highest level since April.
Despite this the yen slid even lower, with USD/JPY ticking to 5-month highs above 157.90.
Then we had intervention type comments from Japan’s finance minister Kato. He used forthright words such as:
- one-sided
- sharp moves
- speculation
which are indicative of a greater degree of concern.
It took some time, but eventually the yen displayed some strength, with USD/JPY dropping back towards 157.15 and thereabouts. Its since been a little lower.
China left its benchmark lending rates unchanged, as expected, at the monthly fixing today.
- the one-year loan prime rate (LPR) was kept at 3.10%,
- the five-year LPR unchanged also, at 3.60%.
These rates were last cut in October; the 1-year by 25bp from 3.35% and the 5-year also by 25bp, from 3.85%. These cuts were the largest since the LPR reform in August 2019 and marked the third reduction in 2024.
In other news the US government moved closer to a shutdown. A bill aimed at furthering funding for the government, promoting Trump’s recommendation to further expand US government debt, failed in the House in Congress. Republicans have a majority in the House but many disagree with fiscal profligacy and voted against Trump's recommendation.
Still to come is the critical US inflation data – PCE – at 8.30am US Eastern time. There is a ‘ranges to watch’ preview above.
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As I was posting we had more intervention type comments from Japan, this time from Atsushi Mimura, Japan's vice finance minister for international affairs, AKA 'top currency diplomat'. USD/JPY is little changed on these so far.
USD/JPY update:
