RBNZ: MNI RBNZ Review-July 2026: More Hikes To Reduce Stimulus

Below is a selection of key recent onshore media highlights for China ICYMI :

Infrastructure Spend (China Daily): Mega dam expansion to boost Yangtze economic belt

https://www.chinadaily.com.cn/a/202606/09/WS6a26f9aaa310d6866eb4d17f.html

US Trade (China Daily): US-bound container prices surge

https://www.chinadaily.com.cn/a/202606/09/WS6a275778a310d6866eb4d1d7.html

Exports (China Daily): 'Remarkable resilience' seen in China's exports

https://www.chinadaily.com.cn/a/202606/09/WS6a276e64a310d6866eb4d277.html

Urban Renewal Financing (China Daily): Fiscal funds, bank loans both seen helping finance urban renewal drive

https://www.chinadaily.com.cn/a/202606/09/WS6a2767ada310d6866eb4d212.html

Industrial Output (China Daily): Supply continues to expand; industrial structure sees faster upgrading

https://www.chinadaily.com.cn/a/202606/09/WS6a2767ada310d6866eb4d212.html

Financial Sector Regulation (China Securities Journal): State Financial Regulatory Commission: Resolutely Advance Strict and Strong Regulation 

https://www.cs.com.cn/xwzx/01/2026/06/09/detail_2026060910016885.html

Interest Rate Liberalization (China Securities Journal): Promoting Interest Rate Marketization Reform to Make Financial Pricing Fairer 

https://www.cs.com.cn/xwzx/jr/2026/06/09/detail_2026060910016884.html

Global Capital (China Securities Journal): China's capital market enters a new stage of high-quality development.

https://www.cs.com.cn/xwzx/01/2026/06/09/detail_2026060910016882.html

North Korea (Xinhua): Xi, Kim hold talks in Pyongyang, pledge to advance China-DPRK ties

https://english.news.cn/20260608/0a428079d41f4cb2b500ebf31bef58c7/c.html

Industrial Output (Xinhua): China's industrial robots reshape smart manufacturing

https://english.news.cn/20260608/f96cda0296c343588a6814c498fc3628/c.html

Real Estate (Securities Daily): China Rental Market Shows Signs of Stabilizing

http://epaper.zqrb.cn/html/2026-06/09/content_1249671.htm?div=-1

Bond Issuance (China Securities Journal): Fiscal Push to Accelerate China’s Local Bond Offers in June

https://epaper.cs.com.cn/zgzqb/html/2026-06/09/nw.D110000zgzqb_20260609_6-A02.htm

https://www.mnimarkets.com/articles/mni-china-press-digest-june-9-economy-fuel-tax-competition-1780970448439

The AU 1-year swap rate one year forward (1Y1Y) is lower sharply lower today but remains 10-15bps above its late May low. 

• Despite the recent rebound, we continue to see value in paying 1Y1Y on a retracement towards the 4.40–4.45% area, particularly if such a move occurs ahead of the key inflation releases over the next two months: the May Monthly CPI Indicator on 24 June and the Q2 CPI report on 29 July.
• This view is supported by the historical tendency for the 1Y1Y to peak in the lead-up to the final rate hike of a tightening cycle. In the current cycle, the market does not fully price the final 25bp hike until December.
• In terms of upside potential, an initial target would be a retest of the recent cycle high of 5.03%. This level sits 43bp above the market-implied peak cash rate of 4.60%, broadly in line with the premium observed at previous cycle peaks.
• Should inflation continue to surprise to the upside, markets may be forced to price a higher terminal cash rate, creating scope for the 1Y1Y to move beyond its recent highs.
• The attractiveness of a paid 1Y1Y position is further enhanced by favourable roll-down dynamics. Over the next nine months, the position benefits from positive roll, improving the carry profile and reducing the cost of maintaining the trade.

Figure 1: 1Y Swap Rate Forward Curve

Source: Bloomberg Finance LP / MNI

Offshore investors remain a focus point for South Korea. Yesterday actually saw a very modest inflow, see the table below. Whilst it only slightly positive it was the first positive inflow day since May 6 of this year. Yesterday's price action in the Kospi/Kosdaq was very poor (off 8%). As we have noted recently, very strongly selling pressures in recent months has been attributed to the outperformance of local tech bellwethers Samsung and SK Hynix, which has forced portfolio rebalancing flows. Is this a sign that such outflow pressures are starting to dissipate? Today's market is rebounding, the Kospi up +3.4%. BBG's NBUY function has foreign outflows so far today (around $350mn). The KRW continues to rally, with USD/KRW back to 1515/20, up a further 0.70% in won terms, as the authorities step up efforts against one-sided depreciation pressures, while National Pension Service (NPS) FX Hedging has also risen. 

• Elsewhere, we have seen Taiwan net outflows pick up in recent sessions. In the US the SOX index has pulled back sharply from the 14k level, although was stronger in Monday US trade. As we noted earlier, the AI trade has run into a market that is starting to take notice of inflation and the NFP print last week is now forcing it to consider a potential rate hike. The Taiex is up today, but will be a watch point for these themes.
• Elsewhere Indian equity outflow pressures remained fairly consistent to last Friday. The RBI has stepped up efforts to curb rupee weakness, but local markets remain under pressure. The Nifty isn't too away from a downside 23k test.
• In South East Asia, the outflow theme remains consistent, with only Thailand positive YTD from a net inflow standpoint. 

Table 1: Asian Markets Net Equity Flows 

Source: Bloomberg Finance L.P./MNI