Halister News

(Bloomberg) -- Australia’s financial intelligence agency, AUSTRAC, signs Memorandum of Understanding for exchange of financial intelligence with Chinese counterpart, CAMLMAC (China Anti-Money Laundering Monitoring and Analysis Center), Justice Minister Michael Keenan says in e-mailed statement.

• Keenan: MOU will help develop financial intelligence to combat drug trafficking, serious financial crimes
• Keenan: “Following the money trail is an essential element in tackling serious and organised crime.”

(Bloomberg) -- UBS revises year-end forecast to 1.36 from 1.25 as cheaper oil is negative for CAD, along with risk of lower inflation readings, FX strategist Jeff Greenberg writes in note received today.

• Says the ~17% chance of a BOC rate cut priced for January is too low
• Investors may not fully appreciate downside risks CAD and housing pose for inflation
  • Changes in housing policy lower the bar for BOC action
• Inflation data on Nov. 18, Dec. 22, will be critical for BOC; downside surprises could prompt trimming of forecasts and rate cut as soon as January
• Spread between USD and CAD yields has widened, overtaking crude as main driver of USD/CAD
• USD/CAD steady after rising 5 days; at 1.3408
• Brent crude futures +1.0% to $48.79bbl

--DOMINIC LAU

(Bloomberg) -- Chinese central bank will be more comfortable in deleveraging the property sector and curbing asset bubbles after October manufacturing PMI surprised to the upside, Zhou Hao, senior economist at Commerzbank says.

• More curbs in housing sector and higher funding cost due to PBOC’s tightening may encourage people to send more cash overseas to seek attractive investments: Zhou
• Forecasts both China one-year IRS and 10-year govt bond yield to move toward 3% this month
  • One-year IRS steady at 2.7588%, while 10-year govt bond yield is little changed at 2.75%
• China Oct. manufacturing PMI rose to 51.2 vs est. 50.3, highest since July 2014
• NOTE: China Factory Gauge Climbs to Two-Year High, Services Gain

Economic Release Details: {CPMINDX Index ECOD} --JEFF KEARNS

(Bloomberg) -- China releases October manufacturing and non-manufacturing PMI at 9am local time. Caixin China PMI manufacturing is also scheduled for 9.45am.

• China October manufacturing PMI est. 50.3 vs prev. 50.4
• China October non-manufacturing PMI est. n/a, prev. 53.7
• China October Caixin manufacturing PMI est. 50.1 vs prev. 50.1

(Bloomberg) -- Further acceleration in Indonesia’s CPI inflation in October could damp prospects for more rate cuts, dragging USD/IDR lower, Bloomberg strategist Andrew Robinson writes.

• Consumer prices probably rose 3.30% y/y following 3.07% gain in September, median est. in Bloomberg survey shows; ests. range from 3.02% to 3.41%; data due today, no time specified
  • Another month of faster inflation may suggest that prices have bottomed out near term after reaching a record low of 2.79% in August
• USD/IDR closed little changed at 13,048 yesterday
  • 50-DMA at 13,093; pair has not traded above it since Sept. 21
• BI last cut 7-day reverse repo rate to 4.75% from 5.00% on Oct. 20; next meeting scheduled for Nov. 16
  • Latest Bloomberg survey shows BI will probably maintain 7-day reverse repo rate steady at 4.75% through 2017
• NOTE: Goldman expects faster headline inflation in October, citing in part, unfavorable base effects, according to a note dated Oct. 28
• NOTE: Andrew Robinson is an FX strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice