ForexLive Asia-Pacific FX news wrap: Chinese yuan gains – strong setting, mixed

• Goldman Sachs is forecasting an initial rate cut from the Bank of England in June 2024
• Deutsche Bank on Powell’s “breaking out the punchbowl early”
• BOJ meet next week – no change to policy expected, but could come as soon as January
• ICYMI – US regulator (SEC) will take a “new look” at spot bitcoin ETF applications
• Reports that China is likely to set 2024 growth target at around 5%
• China’s economic recovery: NBS anticipates meeting full-year targets
• Westpac NZ forecasts no rate hikes, or cuts, from the RBNZ in 2024
• Ex-Fed Dallas head Kaplan says not to overreact to Powell – rate hike options left open
• China November industrial output +6.6% y/y (exp +5.6%) Retail Sales +10.1% (exp +12.5%)
• China November new home prices -0.3% m/m (prior also -0.3%)
• People’s Bank of China set MLF rate at 2.5% (expected 2.5%, prior 2.5%)
• PBOC sets USD/ CNY reference rate for today at 7. 0957 (vs. estimate at 7.1132)
• Japan preliminary manufacturing PMI for December falls to 47.7 (prior 48.3)
• People’s Bank of China to boost liquidity with Medium-term Lending (MLF) injection today
• UK Data – December consumer confidence rises to -22 from -24 in November
• BlackRock expects Fed rate cuts in spring-summer, bank analysts predict multiple easings
• Bank of England holds policy rate amidst hawkish tone, GBP rises
• UBS says 3 rate cuts from the Federal Reserve in 2024 is not really an easing of policy
• Australian Preliminary PMIs for December improve but remain in contraction
• Forexlive Americas FX news wrap 14 Dec: ECB and BOE less dovish leads to USD declines
• US Treas Yellen says artificial intelligence added to a list of risks to financial system
• New Zealand data: November manufacturing PMI 46.7 (up from 42.5 in October)
• US equity close: Rotation evident as some selling hits the big names
• Trade ideas thread – Friday, 15 December, insightful charts, technical analysis, ideas

USD/JPY
had more decent-sized swings again today, from around 141.80 it
traded to (briefly) above 142.40 before dropping all the way back to
where it began. We had lower-tier data from Japan today, not enough
to point a finger at to blame for the move(s). Yen is likely to keep
on moving in a volatile fashion ahead of the Bank of Japan meeting
next week, on the 18^th
and 19^th,
and, I suspect, beyond.

AUD,
NZD, CAD all traded a little higher against the USD. Eyes were on
China where it was a mixed bag today:

• the
  People’s Bank of China set the CNY at its highest reference rate
  since early June;
• the
  PBoC injected a whopping 1.45tln yuan at today’s Medium-term
  Lending Facility (MLF) rate setting and rollover; 650bn yuan matured
  which left a monthly injection of 800bn yuan, its biggest ever;
• Chinese
  economic activity data for November indicated a beat for Industrial
  Production, a miss for Retail Sales, and property-related indicators that
  remained
  very
  weak indeed,
  with
  falling investment, sales and prices.

Offshore
yuan (CNH) has traded strongly during the day so far, helping support
China-related trades (such as AUD).

Offshore yuan higher, 5-minute candles: