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Who will implement the reserve requirement ratio cut and interest rate cut first as expectations rise to the maximum? Industry predictions suggest that the likelihood of a reserve requirement ratio cut by the end of the year is relatively high, while an i
① Currently, it has entered the observation period for policy effects, and the signals for reserve requirement ratio and interest rate cuts are unclear. The probability of an interest rate cut this week is low, but the likelihood of a reserve requirement cut before the end of the year is higher, and the interest rate cut may have to wait until 2025 for a suitable opportunity; ② A domestic interest rate cut may further increase short-term Exchange Rates pressure, and the probability of a short-term reserve requirement cut is greater than that of an interest rate cut. Recently, the Renminbi's exchange rate against the US dollar has declined, reflecting more of a passive depreciation nature.
The central bank today net withdrew 643.5 billion yuan from the open market, and the year-end funding situation will remain relatively loose.
1. It is believed in the industry that the central bank is currently inclined to "protect but not excessively loosen" the monetary policy, focusing on whether to initiate a Reserve Requirement Ratio (RRR) cut before and after the MLF renewal. 2. The central bank will strive to maintain reasonable and ample market liquidity, and the volatility of the funding situation at the end of the year will be significantly lower than in previous years.
Timely lowering of reserve requirements and interest rates, preventing and resolving risks in key areas, maintaining stable Exchange Rates. The central bank, financial regulatory authority, and Forex bureau collectively responded on how to proceed next ye
① The central bank also pointed out the need to explore and expand the macro-prudential and financial stability functions of the central bank, and effectively implement two monetary policy tools to support the stable development of the Capital Markets. Experts indicate that this statement significantly improves market expectations and enhances market anticipation for a slow bull market trend in the medium to long term; ② The Financial Regulatory Bureau pointed out the necessity to effectively prevent and resolve risks in key areas, continuously improving the quality and effectiveness of financial regulation, and promoting high-quality development in the Banking and Insurance industries.
How will the last "Super Central Bank Decision Week" of 2024 unfold?
In summary, last week, the dollar ended its pullback and resumed upward movement, rising for five consecutive days, while other non-MMF currencies experienced varying degrees of decline.
The central bank will implement a moderately loose monetary policy and timely reduce the reserve requirement ratio and interest rates to maintain ample liquidity.
① Implement a moderately loose MMF policy effectively. ② Better support key areas and weak links of high-quality development.
The State Administration of Foreign Exchange: In November, Banks settled 1465.8 billion yuan and sold 1440.9 billion yuan.
According to Statistics from the State Administration of Foreign Exchange, in November 2024, Banks exchanged 1,465.8 billion yuan and sold 1,440.9 billion yuan.
OCBC Bank: The market has fully priced in a 25 basis point rate cut from the Federal Reserve.
OCBC Bank economist Wang Haoting in Hong Kong stated that looking ahead to this week, the market will focus on a series of PMI data from the Eurozone, USA, United Kingdom, and Australia.
In November, China's industrial added value above the designated size increased by 5.4% year-on-year, with New energy Fund, Siasun Robot&Automation, and integrated circuits leading the growth.
From January to November, the added value of large-scale industries grew by 5.8% year-on-year. Among them, the production of New energy Fund vehicles, Siasun Robot&Automation, and integrated circuit products increased by 51.1%, 29.3%, and 8.7% respectively.
National Statistics Bureau: In November, the total retail sales of consumer goods increased by 3.0% year-on-year.
In November, the total retail sales of consumer goods reached 4,376.3 billion yuan, an increase of 3.0% year-on-year. Among them, the retail sales of consumer goods excluding Autos were 3,899.8 billion yuan, showing a growth of 2.5%. From January to November, the total retail sales of consumer goods reached 44,272.3 billion yuan, with a year-on-year increase of 3.5%. The retail sales of consumer goods excluding Autos were 39,796 billion yuan, growing by 3.7%.
China's November Retail Sales Rise 3.0%, Industrial Production up 5.4%
Forecasting the Upcoming Week: Global PMIs Kick off Another Heavy Rate Call Week
November financial data has been released. The M2 growth rate has declined year-on-year. How should we view the slowdown in social financing and the decreased new Crediting year-on-year?
1. The speed and rhythm of social financing scale and Crediting in November are relatively stable, and financial support for the real economy remains strong; 2. In December, the scale of hidden debt replacement will further increase, which may continue to cause significant disturbances to new Crediting and new social financing data.
Weekly Focus: It Is the Season for Rate Cuts
The financial community's C50 wind index survey shows that institutions predict an increased probability of a rate cut in the near future, with the funding rate central expected to remain stable in December.
① The median forecast for new RMB loans in November is 0.64 trillion yuan, which is a year-on-year decrease of 0.45 trillion yuan; ② The median forecast for new social financing scale in November is 2.58 trillion yuan, which is a year-on-year increase of 0.13 trillion yuan; ③ The market anticipates that the year-on-year growth rate of CPI in November may stop declining and rise, with a minor narrowing of the PPI decline due to the low base effect; ④ The probability of a timely rate cut has increased recently, and there is still a necessity for interest rate cuts.
OECD: Global economic growth rate will slightly increase next year, but high tariffs and budget deficits pose risks.
OECD released the latest "Economic Outlook" on Wednesday, forecasting a 3.2% global economic growth this year, and expected growth of 3.3% in 2025 and 2026. The organization also warned that if tariffs rise and governments fail to reduce large budget deficits, global economic growth rates may slow down.
World Economy to Accelerate in 2025, But Recovery Threatened by Higher Tariffs, OECD Says
China's Caixin Services PMI Drops to 51.5 to in November Vs. 52.5 Expected
The Nasdaq index reached a new high, French stocks rose, the south korea etf narrowed after a 7% drop, and the offshore yuan briefly fell below 7.31 yuan.
South Korean President Yoon Suk-yeol abruptly declared a state of emergency, boosting safe-haven assets such as U.S. Treasury bonds, Japanese yen, and gold, while cryptos on the South Korean exchange plunged. The South Korean parliament quickly passed a resolution to lift the state of emergency, with the Ministry of Finance and the central bank actively working on market rescue measures. After a 2.7% drop to a two-year low, the won’s decline was cut in half, South Korean etfs fell by 1.6%, and the yield on 10-year U.S. Treasury bonds turned to increase after hitting a new low in over a month. France is set to vote on dissolving the government as early as Wednesday, with French stocks following European markets upward, although they had previously declined during the day. The Dow Jones, small cap stocks, and semiconductor indices fell, while the China concept index once rose by 1.9%. The yuan hit a new low in a year during the day, and U.S. oil rose nearly 3% testing the $70 mark.
China's Central Bank Chief Signals Support for Economy in 2025
Nasdaq, S&P hit new highs, French stock and bond yields fluctuate and rise, Euro once fell more than 1%, Dollar rose.
On the first trading day of December, Cyber Monday shopping amounts will break records, with the Nasdaq and Chinese concept stocks rising about 1%, and the chip index leading with a 2.6% increase, while the Dow fell from its peak. Tesla soared over 4% during the day, intel rose nearly 6% before turning negative, super micro computer surged nearly 29%, and Xpeng autos climbed over 5%, but Li Auto dropped nearly 4%. The French government faces a vote of no confidence, causing French stocks to briefly fall over 1%, and the spread between French and German government bond yields approached the widest in twelve years. US henry hub natural gas fell over 4%, the indian rupee hit a new low, and the offshore yuan dropped over 400 points, falling below 7.29 yuan.