Asian Markets Update

Regional markets mixed; Nikkei +0.2%; S&P/ASX down 0.1%; HSI down 0.5%; Kospi down 0.2%; Taiex +0.4%; Sensex +0.1%; Shanghai Composite +0.4%; STI down 0.9%; Philippine shares down 0.2%; SET +0.6%; NZX-50 +0.2%; Indonesian and Malaysian markets shut for a holiday. In FX markets, EUR up vs USD and JPY, after RBA minutes show central bank remains upbeat. EUR/USD is at 1.3523 from 1.3488 in NY late Monday, EUR/JPY is at 112.85 from 112.39, USD/JPY is at 83.45 from 83.34. RBA meeting minutes say a slightly restrictive monetary policy remains appropriate, with consumer caution and low inflation providing it with time to assess the outlook, adding recent flooding is unlikely to affect the medium-term economic outlook, where it is focusing policy.

China January CPI +4.9% on-year vs +4.6 in December, +5.4% expected; China’s Bureau of Statistics says it reduced the CPI basket’s weighting of food by 2.21 percentage points, raised property-related items’ weighting by 4.22 percentage points. China January PPI +6.6% on-year vs +5.9% in December, +6.3% expected. China’s State Information Center think tank says further China interest rate hikes are inevitable, adding banks’ reserve requirement ratio could rise to 23% from 19% currently.

The BOJ votes unanimously to leave overnight call rate range unchanged at 0.0%-0.1%, as widely expected, and says it will keep extremely easy monetary conditions; it raises its economic view for the first time since May 2010; it says the Japanese economy is gradually emerging from a deceleration phase. Japan December revised industrial output +3.3% on-month vs preliminary +3.1%


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