CHINA: Data Preview: Loan Prime Rates

Fiscal policy will support the expansion of new growth drivers, focusing on upgrading key industrial chains in manufacturing and implementing the third batch of pilot cities for new technological transformation of manufacturing, Economic Information Daily reported citing a Ministry of Finance report. The ministry will use special funds, government investment funds, financing guarantees and other tools to support the development of high-tech enterprises and technology-based SMEs. It will further increase government investment in education and gradually promote free preschool education, as well as expand employment for key groups and increase basic pensions.

China’s total electricity consumption reached 1.65 trillion kilowatt-hours in the first two months, marking a year-on-year increase of 6.1% which was 4.8 percentage points higher than that of the same period last year, Securities Daily reported citing data by National Energy Administration. This was mainly due to increased electricity demand driven by the cold wave in January and a lower comparison base, the newspaper said. 

The EUR/USD range overnight was 1.1480-1.15247, Asia is currently trading around 1.1535, -0.05%. The pair found good demand sub 1.1500 and traded with a bid tone overnight as risk stabilised and the USD pared back recent gains. The pair is bouncing off its pivotal support and could potentially pullback further, I still prefer to be skewed toward fading rallies for the moment in the medium term though. On the day, I suspect we see buyers back toward 1.1480-1.1500 initially with the first sell-zone is back toward 1.1580-1.1610 and then the more pivotal 1.1690-1.1740 area, looking for another test of the pivotal 1.1400-1.1500 support at some point. 

• “The EU is restarting the long-delayed ratification of its US trade deal. A committee vote Thursday will then go to a full plenary vote this month or next.” - BBG
• Options : Closest significant option expiries for NY cut, based on DTCC data: 1.1450(EU1.27b), 1.1650(EU1.35b). Upcoming Close Strikes : 1.1400(EU1.55b Mar 20), 1.1500(EU1.3b Mar 19), 1.1815(EU1.79b March 19), 1.1815EU1.79b March 19) - BBG
• The EUR/USD Average True Range for the last 10 Trading days: 77 Points

Fig 1 : EUR/USD Spot Daily Chart

Source: MNI - Market News/Bloomberg Finance L.P