MNI Asia Pac Weekly Macro Wrap:

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Executive Summary:

JAPAN 

• Japan’s PPI was close to forecasts, while import prices continued to rise m/m and are no longer negative y/y. The weaker yen implies a further import rise in Jan, which is reportedly coming under increased focus from the BoJ. FX intervention rhetoric picked this week, but pull backs in USD/JPY remained modest. 

AUSTRALIA 

• The main data release this week was household spending, which for Nov rose more than forecast (above 6%y/y). This is at odds with softer consumer sentiment readings, but is unlikely to shift RBA thinking in the near term.

NEW ZEALAND

• New Zealand sentiment data continued to improve, along with other indicators like jobs filled. The backdrop suggests a firmer NZ growth backdrop for late 2025 and into early 2026. RBNZ thinking may not shift near term though, given the low base growth is coming from. Note next Friday delivers Q4 NZ CPI. 

SHORT TERM RATES 

• Interest-rate expectations across the $-bloc over the past week, looking out to June 2026, have been little changed, with the notable exception of the US, where expectations firmed by 8bps. Elsewhere, Canada pricing edged 3bps lower, while Australia and New Zealand were between flat to 2bps higher.

CHINA 

• This week’s trade data painted a resilient picture for China’s external sector. Export growth surprised on the upside and we can see further yuan outperformance in basket terms before threatening the outlook.

SOUTH KOREA 

• The BoK held rates steady this week, as widely expected. However, the central bank removed references to cutting rates, so it was viewed as a hawkish hold. Local rates pushed higher, but the won received little benefit, still weighed down by domestic outflows. 

ASIA 

• Malaysia Q4 GDP growth was stronger than expected, capping off a 2025 where growth was resilient compared to other parts of South East Asia. We also argued this week that there is scope for short end INDOGB yields to revert back to 2025 lows. 

ASIA EQUITY FLOWS 

• Tech related inflows into markets like South Korea and Taiwan are positive 2026 to date, but lag the gains seen in local bourses.