Market news for Monday, December 5, 2022’s Asian trade
Market Analytics and Technical Considerations
Key Points
Early this morning in Asia, the USD saw some slight gains. As other Asian markets became active and currencies expanded their gains practically everywhere, the US dollar’s “edge” higher quickly reversed. All of these currencies — including gold — are higher. Since there were few net changes during the session, the yen is a bit of a laggard.
The COVID constraints were gradually loosened in China. Poor PMI data was ignored as the upbeat outlook increased. Both the offshore and onshore yuan appreciated against with the dollar.
No adjustment to the output policy was reaffirmed by OPEC+ over the weekend. Regarding oil, Alexander Novak, the deputy prime minister of Russia, declared over through the weekend that his country would not supply oil to nations that were a member of the oil price ceiling. On Sunday evening (US est), when futures trading resumed, oil initially increased but has since decreased.
Today’s Australian statistics revealed growing headline inflation, while core (snipped mean) inflation remained constant at slightly around 5% y/y, far more than the RBA objective. This information comes from a privately survey that was conducted and serves as a good indicator of official statistics. Data on salaries in Q3 came from Australia as well, coming in at +11% y/y, far higher than the rate of inflation.
This could lead to a spiraling wage-price relationship. Tomorrow’s Reserve Bank of Australia meeting will likely result in a 25 bp increase to the cash rate. The Bank claims to be in a “waiting and just see” phase as it evaluates the effects of the prior rate hikes on the economy. If they mention the increase in earnings at all, I’ll be fascinated. Remain connected. On Tuesday, December 6, 2022, at 03:30 GMT, the Reserve Bank of Australia must release its announcement.
