AUD declines on RBA statement

Asia market update: AUD declines on RBA statement; Equities decline after losses on Wall St.; Softer inflation figures seen from JP and KR; Japan PMI revised lower.

General trend

- China Caixin Services PMI beat ests.

- Weaker BTC seen at JGB auction.

- Gold rises after prior volatility.

- TECH firms generally decline after drop on the NASDAQ.

- Japanese equities decline amid the recent Yen strength; Fast Retailing drops after reporting monthly sales.

- Resources index lags in Australia.

- Aussie GDP due on Wed; US ISM Services also in focus.

Headlines/economic data

Australia/New Zealand

-ASX 200 opens -0.2% at 7,109.

- Reserve Bank of Australia (RBA) leaves cash rate target unchanged at 4.35%; as expected; [Reiterates] Whether further tightening of monetary policy is required to ensure that inflation returns to target in a reasonable timeframe will depend upon the data and the evolving assessment of risks; Monthly CPI suggest inflation is moderating.

-Australia Q3 Current Account (A$): -$0.2B v +$3.2Be [first deficit since Q3 2022]; The prices of goods exports decreased for the fifth consecutive quarter.

- Australia Nov Final PMI Services: 46.0 v 46.3 prelim (confirms the 2nd month of contraction).

- New Zealand Q3 Volume of All Buildings Q/Q: -2.4% v -0.5%e.

-New Zealand Nov ANZ Commodity Price M/M: -1.3% v 2.9% prior [first decline since Aug].

-New Zealand Government 4-Month Financial Statements: 4-month budget deficit at NZ$3.85B, which is NZ$91M wider than projected.

China/Hong Kong

- Hang Seng opens -0.2% at 16,606.

- Shanghai Composite opens -0.2% at 3,017.

- China Nov CAIXIN PMI services: 51.5 V 50.5E [3-month high].

- China PBOC should cut the RRR [inline] - Chinese press.

- CSRC [China Securities Regulator] Chairman Yi Huiman: To strengthen supervision of stock trading acts; Zero tolerance to market manipulation.

- China Nov Domestic Online Game Approvals 87 v 87 m/m.

- China sees >8M borrowers in default (record v 5.7M back in early 2020) across mortgages and business loans as economic crisis deepens - FT.

- China issues transport safety guidelines for self-driving cars.

Japan

-Nikkei 225 opens -0.6% at 33,022.

- Japan NOV Tokyo CPI Y/Y: 2.6% V 3.0%E; CPI (ex-fresh food) Y/Y: 2.3% V 2.4%E [slowest annualized pace since Jul 2022].

- Japan Nov Final PMI Services: 50.8 v 51.7 prelim (confirms 14th month of expansion; lowest since Nov 2022); PMI Composite: 49.6 v 50.0 prelim [Output falls for first time in 2023; first contraction since Dec 2022].

- Japan SELLS ¥2.7T in 10-year jgb bonds; AVG YIELD: 0.6970% V 0.9100% prior; bid-to-cover: 2.82X V 3.62X PRIOR [lowest BTC since 2021].

- Bank of Japan (BOJ) sees monetary easing as having pushed up prices by 1.0% [relates to monetary easing over the past 25 years] - Japanese press.

- (JP) Eyes limited extension to tax breaks for home loans - Japanese press.

- Japan govt plans to offer tax breaks to encourage M&A among SMEs - Japanese press.

- Japan Economy Min Nishimura: Not thinking Japan to triple its nuclear power capacity.

- Japan said to plan to issue >$10.0B in Transition Bond - US financial press.

Korea

-Kospi opens -0.3% at 2,507.

-South Korea Nov CPI M/M: -0.6% V -0.3%E; Y/Y: 3.3% V 3.5%E.

-South Korea Q3 preliminaryGDP Q/Q: 0.6% V 0.6%E; Y/Y: 1.4% V 1.4%E.

-South Korea Nov Foreign Reserves: $417.1B v $412.9B prior.

-Bank of Korea (BOK): Reiterates fast inflation slowdown not likely to continue, expects inflation slowdown pace to be gradual [comments after Nov CPI data].

-China and South Korea sign agreement to deepen supply chain cooperation - China Ministry of Commerce.

Other Asia

-Philippines Nov CPI M/M: 0.2% v 0.4%e; Y/Y: 4.1% v 4.3%e.

Europe

- (UK) Nov BRC Sales LFL Y/Y: 2.6% v 2.6% prior.

Levels as of 00:20 ET

- Nikkei 225, -1.1%, ASX 200 -0.9% , Hang Seng -1.8%; Shanghai Composite -1% ; Kospi -0.5%.

- Equity S&P500 Futures: -0.2%; Nasdaq100 -0.3%, Dax -0.1%; FTSE100 -0.1%.

- EUR 1.0846-1.0831 ; JPY 147.38-146.97 ; AUD 0.6624-0.6571 ;NZD 0.6175-0.6139.

- Gold +0.4% at $2,049/oz; Crude Oil +0.1% at $73.11/brl; Copper +0.1% at $3.8273/lb.