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Forex News for November 15, 2021

Industrial Production increased by 3.5 percent year over year, indicating a positive trend. 3.0% predicted, compared to 3.1% previously. China’s property sector woes are unlikely to cause a large global shock.

Steel output in October fell to its lowest level since December 2017. Crude steel output has dropped 28% in the last five months and is down 0.7% year to date. Since March 2015, OCOT coal output has been at an all-time high.

Industrial Production YTD: 10.9 percent y/y, up from 11.8 percent the year before. Retail sales increased by 4.9 percent year over year, indicating a positive trend. Expected 3.5 percent, compared to 4.4 percent previously. 

Retail sales are up 14.9% year over year, compared to 16.37% the previous year. Fixed Assets (excluding rural) 6.1% year-over-year. 

Projected 6.2%, prior 7.3%, and YTD for this +8.5% year-over-year.

In October, the unemployment rate in the cities examined was 4.9%. Anticipated 4.9%, and previous 1.9%.

On Japan: 

Today’s weak GDP is likely due to a consumption slump in September when a spike in infections hit eating-out and travel.

 In the October-December quarter, Japan’s economy is predicted to steadily improve. 

Commodity prices are growing as a result of robust global demand. Which is good news for Japan’s economy. Corporate fund demand gradually subsidizes as the economy improves.

On Evergrande: 

Japan’s financial institutions have relatively little exposure to China’s Evergrande.

Anticipation about China’s property sector’s difficulties to have a significant impact on Japan’s economy or banks is not looking good. 

China’s property sector woes are unlikely to cause a large global shock. Policymakers, such as those at central banks, have made spectacularly erroneous judgments on numerous crises as they spiraled out of control. It caused Japanese corporations to reassess their views on the country’s prospects.

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On Monday, limited ranges persisted across the board for major FX in Asia to start the week. The prevailing pattern in the tiny ranges was a hint of weakening for the US dollar. GBP, EUR, AUD, NZD, and CAD are all up versus the dollar. But USD/JPY and USD/CHF are essentially unchanged.

Also from China today, the People’s Bank of China announced a massive 1 trillion yuan infusion via a medium-term loan facility (MLF). The ‘but’ was that the infusion was intended to offset a $1 trillion investment in aging facilities. Bitcoin has been on the rise; as I write, BTC/USD has traded back above US$66K, albeit it is currently slightly below that level.

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