Forexlive Asia-pacific Fx News Wrap: Australian Monthly Cpi Not Enough For Another Rba Cut

• China not happy with Canada - disrupt international trade rules, harm global supply chain
• Nomura’s time-zone analysis for USD/JPY
• Bank of England Monetary Policy Committee external member Dhingra speaking Wednesday
• Japan Post plans $4 bn share sale in Japan Post Bank
• Bitcoin forecast to drop into low 80K area
• China's Vice Commerce Minister has met with US business leaders
• Tesla begins deliveries of updated Model Y in China
• The US House has passed the Republican Budget plan, advancing Trump's tax plans
• PBOC sets USD/ CNY central rate at 7.1732 (vs. estimate at 7.2526)
• Copper - Chile restoring electricity supply
• Australian monthly CPI (January 2025) 2.5% y/y (vs. 2.6% expected)
• Australian data - Q4 2024 Construction Work Done +0.5% q/q vs. 1.0% expected
• Japan’s Nikkei expected to rise as high as 42,500
• ICYMI - Chile's nationwide power outage - has impacted copper operations
• Bank of Korea's rate cut reflects growing deflation risks
• Africa - Government efforts to prop up the price of cobalt
• Forexlive Americas FX news wrap: US consumer confidence sinks, drags down risk assets
• Oil - private survey of inventory shows a headline crude oil draw vs. build expected
• Trump says it possible he'll allow Russian oligarchs Residency in the US
• Trade ideas thread - Wednesday, 26 February, insightful charts, technical analysis, ideas
• Trump indicates there will be a need for boots on the ground in Ukraine
• Lutnick says 'its time for copper to come home' - no exemptions, no exceptions

The monthly inflation data always needs to be read with care (more on why in the posts above). The January data today showed headline inflation coming in at 2.5% y/y, a touch below median estimates, in line with the previous month’s reading, and bang on the mid-point of the Reserve Bank of Australia 2 - 3% target band, Its this mid-point that the Bank and the government have agreed to as a target. The core reading, Trimmed Mean, however, was higher at 2.8%, up from December’s 2.7%.

The details in the data are not indicative of another Reserve Bank of Australia rate cut any time soon., The Bank will be eyeing the ‘official’ quarterly data due in late April.

The AUD moved more or less inline with other major FX, initially ticking a little stronger against the USD before dropping away.

JPY tracked a similar pattern, with USD/JPY seeing lows under 148.70 briefly before recovering to circa 149.50.

In US political news Trump scored a big win for his 2025 agenda, with the US House passing the budget bill that includes extending Trump’s 2017 tax cuts, provisions for deportation funding, stricter border security, energy deregulation, and increased military spending.

Chinese equities, both mainland and in Hong Kong had a strong session.