Fed rate decision, South Korea Trade, Australia Unemployment, New Zealand GDP
China’s November retail sales see significant miss
China’s industrial output for November grew 2.2%, after seeing growth of 5% in October, according to official data. That is lower than expectations for growth of 3.6% in a Reuters poll.
Retail sales fell 5.9% year-on-year, more than expectations for a 3.7% decline in a Reuters poll and a 0.5% drop last month.
— Ji Hye Lee
JPMorgan expects Asian markets to end the week on a cautious note following the Fed hike
JPMorgan expects markets in the Asia-Pacific region to end the week on a cautious note following the Federal Reserve̵[ads1]7;s 50 basis point interest rate hike.
“Given the US market reaction after the FOMC meeting, we expect Asian markets to end the week on a more cautious note,” Tai Hui, the firm’s Asia-Pacific market strategist, said in a note.
Tai added that a weaker inflation print is needed before the Fed’s hawkishness disappears, while the region may have more optimism on China’s expected reopening.
“The medium-term outlook for China’s economic reopening and Asia’s resilience to domestic demand could be a bright spot as the US and Europe face more growth challenges,” Tai said. “We will need more weak inflation data for the Fed to tone down its hawkishness.”
— Ji Hye Lee
South Korea’s revised trade data shows a slightly smaller trade deficit
South Korea’s revised trade data for November was flat, official data from the Bank of Korea showed.
Imports grew by 2.7% while exports fell by 14%, in line with readings from the previous month, resulting in a trade deficit of $6.99 billion, slightly smaller than the previous month’s reading of $7.01 billion.
Prices for imports grew 14.2% compared to a year ago after growing 19.8% last month. Export prices grew 8.6% in November compared to a year ago, after growing 13.7% in October.
— Ji Hye Lee
Japan’s trade data beats estimates, reports a larger-than-expected trade deficit
Japan’s exports and imports for November grew more than expected on a year-on-year basis, official data showed.
Exports for the month rose 20%, beating expectations of 19.8% in a Reuters poll. Imports rose 30.3%, also higher than expectations of 27% in a Reuters poll.
This resulted in a larger-than-expected trade deficit of 2.02 trillion yen ($14.91 billion) after posting 2.16 trillion yen ($15.96 billion) in the previous month.
— Ji Hye Lee
CNBC Pro: Missed China’s Reopening Rally? Bank of America designates global stocks to take second stage
Investors will have another opportunity to take part in the stock market rally after China announced an easing of Covid-19 restrictions, according to Bank of America.
The bank named more than 10 stocks after finding “green shoots of recovery in high-frequency data” that point to rising earnings at companies that export to China.
CNBC Pro subscribers can read more here.
– Ganesh Rao
Australia unemployment in line with expectations
Australia’s unemployment rate for November held at 3.5% year-on-year, in line with expectations in a Reuters poll and flat from last month.
Official data from the Australia Bureau of Statistics showed the labor force participation rate also remained at 66.7%, and the employment-to-population ratio remained at 64.4%.
Monthly working hours increased to 1.89 billion.
— Ji Hye Lee
The Fed announces a 50 point rate hike
The Fed announced it will raise interest rates by 50 basis points, marking the end of the pattern of 75 basis point hikes seen in recent months.
Before this move, the Fed had raised interest rates by 75 basis points at the last four meetings. One basis point corresponds to 0.01%.
The increase of 50 basis points was widely expected ahead of the meeting.
It is the final political decision expected from the central bank in 2022.
— Alex Harring
Powell wants “substantially more evidence” that inflation is cooling
Federal Reserve Chairman Jerome Powell said on Wednesday that the recent positive signs of inflation are not enough for the central bank to ease rate hikes.
“It will take significantly more evidence to have confidence that inflation is on a sustained downward path,” Powell said during his post-meeting news conference.
The comments came as the Fed raised its benchmark interest rate by another half a percentage point and indicated that at least another three-quarters of hikes are coming. The decision also comes a day after November’s consumer price index was up just 0.1%, an indication that inflation may have peaked.
However, Powell said inflation remains a concern.
“Price pressures remain evident across a wide range of goods and services,” Powell added.
-Jeff Cox
