Chinese GDP for 2022 at 3.0% missed expectations (5.5%) significantly and represented the slowest growth for the world’s second largest economy since 1976 and the end of the austerity of Mao Zedong. Q4 GDP beat expectations at 2.9% vs 1.8% but was still very weak. Retail Sales & Unemployment also beat at -1.8% vs. -9.5% and 5.5% vs. 5.8%, respectively. Japanese 10-yr yields still trade over 0.50% above the BOJ ceiling ahead of BOJ tomorrow. The UK Jobs market remains v tight (Unemployment 3.7%) – Earnings up (6.4% vs 6.1%) but still way short of Inflation. (CPI & Retail Sales data tomorrow). German HICP inflation confirmed & unchanged at 9.6%.
The USD Index recovered from under 102.00 at 101.70, to 102.15 now. EUR – holds over 1.0800. The pair touched 1.0875 on Monday (9-mth highs) and trades back to 1.0820 now. JPY – dipped again touching 127.20 lows, but is now back over 128.00 and has tested 128.80 today. GBP – Sterling tested 1.2290, slipped back to 1.2160 lows and has recovered 1.2200 following the UK data. Stocks – The US markets closed higher on Friday (+0.33-0.71%), following generally good Banking Earnings, tempered by cautious outlooks and job losses. US500 FUTS trade at 4002. USOil – rallied again to test $80.00 but has since slipped to $79.00 following the Chinese data. Gold – the Bid remains strong as $1900 holds, $1930 was tested yesterday, the precious metal is back to $1910 now. BTC – Weak USD helps to lift prices over $20k and holds over $21k today.Today – Canadian CPI, Speeches from Fed’s Williams, ECB’s Centeno & Chinese Vice Premier Liu. Earnings – Goldman Sachs, Morgan Stanley & United Airlines.
Biggest FX Mover @ (07:30 GMT) CHFJPY (+0.53%). Bounced from a test of 137.50 zone on Friday and adds to gains today at 139.20 but is down from 149.00 highs in December. MAs aligned higher, MACD histogram & signal line positive & rising. RSI 66.80 & rising, H1 ATR 0.230, Daily ATR 1.856.
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Stuart Cowell
Head Market Analyst
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