Macro outlook

• Global:  With the US on vacation today for Martin Luther King day, markets could be very thin. US treasuries had another tough day on Friday ahead of the vacation, with 2Y and 10Y USTs selling off sharply in almost parallel move that leaves the 10Y yield just below 1.80%. US data on Friday were soft though, with big falls in US retail sales overshadowing  the slight uptick in inflation expectations from the University of Michigan consumer sentiment survey. The EURUSD retreated from its recent spike and has settled down to just over 1.14 with the AUDUSD moving in tandem down to just over 0.72. Asian FX were fairly rangebound on Friday, though the INR was weaker than most of the pack. Busy day ahead for Asian releases. 
• China: GDP for 4Q21 will be released with activity data. The market will likely register disappointment if GDP for 4Q21 grew below 4%YoY. Activity data should show some improvements in retail sales and fixed asset investments in December 2021, but not enough to change the slower 4Q21 GDP trend. Over the weekend, the central government urged local governments not to impose unnecessary social distancing measures. The objective is to limit economic damage during the Chinese New Year holiday. The first community Omicron infection was found in Beijing on Saturday. We believe that Beijing will impose very strict social distancing measures as it is preparing for the Winter Olympics.
• Singapore: December non-oil domestic exports (NODX) expanded 18.4%YoY, slightly better than expected.  Electronics exports, however, fell below market expectations, rising 13.6% vs. a 17.1% forecast.  NODX expansion could moderate in early 2022 due possibly to softer global demand tied to the recent pickup in Covid infections. 
• Indonesia:  Trade data will be reported on Monday.  Exports and imports are both expected to extend the streak of double-digit gains as Indonesia’s exports benefit from elevated commodity prices while imports surge due to the gradual economic reopening.  The trade balance will likely remain in surplus, which should help keep the current account balance and IDR supported in the near term.     

What to look out for: China GDP

• Singapore NODX (17 January)
• China GDP, industrial production retail sales (17 January)
• Indonesia trade balance (17 January
• Bank of Japan policy meeting (18 January)
• US building permits (19 January)
• Australia unemployment (20 January)
• China 1-year prime rate (20 January)
• Bank Indonesia policy rate (20 January)
• US initial jobless claims and existing home sales (20 January)
• Japan national CPI inflation (21 January)