ForexLive Asia-Pacific FX news wrap: AUD to its lowest in a year, NZD lowest in two years

• China’s bond market is screaming the “D” word. “D” as in depression.
• US dollar reaction on Fed hints at slowing the pace of interest-rate cuts may be muted
• Australia regulator pursuing Binance Australia Derivatives re consumer protection failures
• BOJ is expected to hold its policy rate at 0.25% in its December 18-19 meeting – preview
• ICYMI – Switzerland has slashed economic growth forecasts
• Bank of America’s latest global fund manager survey – super bullish sentiment
• South Korea Finance Minister Choi – will manage the economy as stably as possible
• UBS sees gold extending gains into 2025, forecasts $2,900/oz price target
• PBOC sets USD/ CNY mid-point today at 7.1880 (vs. estimate at 7.2838)
• UK pay growth steady at 4% but expected to slow in 2025
• National Australia Bank predicts an RBA interest rate cut in May 2025 (February questions)
• Japan November exports +3.8% y/y (expected +2.8%) imports -3.8% y/y (expected +1.0%)
• Australia Leading Index: Three quarters of components now giving positive growth signals
• Australian government forecasts ballooning debt
• Nissan and Honda are said to be in talks to set up a holding company
• ‘Spy drones’ from China likely wreaking havoc over US, House foreign affairs chair claims
• ICYMI – China promised massive stimulus yesterday (will it work this time?)
• BoA bullish US stocks despite “boiling geopolitical instability”, waning US fiscal health
• Fed insider says FOMC cut today, but then “a much more cautious tone about further cuts”
• Oil – private survey of inventory shows headline crude oil draw much greater than expected
• New Zealand data: Q3 Current Account 10.6bn NZD (expected -10.5bn)
• Is Milei rewriting economic theory?
• US stocks close lower. Dow down for the 9th consecutive day
• Forexlive Americas FX news wrap: US retail sales boosted by autos
• Trade ideas thread – Wednesday, 18 December, insightful charts, technical analysis, ideas

AUD,
NZD and CAD were further losers here during the session, remaining
under pressure from weak China demand and a strong US dollar. AUD/USD
hit its lowest since October 2023 while the kiwi $ traded down to its
lowest since October 2022. The only fresh news of note was from
Australia, where the government has forecast widening deficits ahead,
and surging debt.

USD/JPY
ticked back up, to highs just short of 153.80. The Bank of Japan
Statement is due on Thursday (expected in the 0230 – 0330 GMT time
window, which is 2130 – 2230 US Eastern time). The Bank is expected
to leave rates unchanged. Bank of Japan Governor Ueda is expected to
convey hawkish signals in his following press conference (0630 GMT /
0130 US Eastern time).

Ahead
of the BoJ tomorrow is, of course, the Federal Reserve later on
Wednesday. The Fed’s Federal Open Market Committee (FOMC) is
expected to cut Fed Funds by 25bp and to indicate a slower pace of
rate cuts ahead. There is more in the previews in the points above.

***

Elsewhere:

• Nissan’s stock surged the most in at least fifty years on talk of a merger with Honda
• Bitcoin pulled back further

This article was written by Eamonn Sheridan at www.forexlive.com.