<p style=““ class=“text-align-justify“>That figure is lower than the $87.80 consensus seen last month, despite the news that China is staying firmly on course to re-opening its economy. Meanwhile, Brent crude is seen averaging $89.37 next year and that forecast is down from the $93.65 consensus from the November survey.</p><p style=““ class=“text-align-justify“>According to the poll, the impact of sanctions on Russian oil is expected to be minimal with Goldman Sachs noting that „we do not expect an impact from the price cap, which was designed to give bargaining power to third-country buyers“.</p><p style=““ class=“text-align-justify“>It seems like for now, the softening global outlook is weighing on sentiment as the market seems to be fearing a hit to demand amid a recession in most major economies. But China will be a key factor to be mindful of in the first half of the year I would say, before we start to see how market players will take to the recession fears and potential reversal of the central bank tightening cycle.</p><p style=““ class=“text-align-justify“>As for the oil market itself, conditions remain tight and the lack of investment are still two key drivers to be wary of in the longer-term outlook.</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>The announcement comes via the PBOC and will go into effect from 3 January. This will see the domestic interbank FX market, the ChinaForeign Exchange Trade System (CFETS), observe trading hours until 3.00am local time (from 11.30pm currently).</p><p style=““ class=“text-align-justify“>The time for the fixing for the yuan currency and spot closing both remains unchanged though at 9.15am and 4.30pm local time respectively. The change to the trading hours above is said to „promote the development of the foreign exchange market and expand high-level opening“. The full announcement can be found <a target=“_blank“ href=“https://www.pbc.gov.cn/goutongjiaoliu/113456/113469/4751668/index.html“ target=“_blank“ rel=“nofollow“>here</a>.</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>And that is despite a surging recovery in the currency over the past two months, with USD/CNY having 7.30 at the peak in late October to early November. The over 8% decline will be the worst performance by the Chinese onshore yuan against the dollar since 1994 when China unified market and official rates.</p><p style=““ class=“text-align-justify“>I’ve argued plenty of times during the course of the year that if China is allowing its currency to weaken, that is a major tailwind signal for the dollar to extend higher – as we saw during the August period <a target=“_blank“ href=“https://www.forexlive.com/news/a-key-trigger-for-the-next-leg-higher-in-the-dollar-20220819/“ target=“_blank“ rel=“follow“>here</a>.</p><p style=““ class=“text-align-justify“>As such, this will continue to be a key consideration for the greenback going into next year as the Fed tightening cycle will be called into question and as China has moved away from its zero-Covid policy.</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>At some point in the past five to six years, it was a wonder as to how the Swiss central bank will ever be able to escape negative rates and spur inflation in the economy – much like Japan. Yet, here we are now where policymakers have not only moved on from that but are now actively having to step into the market to strengthen the Swiss franc instead.</p><p style=““ class=“text-align-justify“>That last line is definitely something I’d never thought to be typing, even at the start of the pandemic.</p><p style=““ class=“text-align-justify“>The latest <a target=“_blank“ href=“https://data.snb.ch/en/topics/snb/cube/snbfxtr“ target=“_blank“ rel=“nofollow“>balance sheet data</a> from the SNB shows that the central bank sold foreign currencies worth CHF 739 million in Q3 2022, exemplifying how their focus has shifted from curbing and smoothing out the appreciation in the franc currency over the years to fighting inflation this year. That comes of course amid their change in policy stance as well.</p><p style=““ class=“text-align-justify“>How the times have changed.</p>

This article was written by Justin Low at www.forexlive.com.

<ul><li>CPI +0.3% m/m</li><li>Prior -0.1%</li><li>HICP +5.6% vs +6.0% y/y expected</li><li>Prior +6.7%</li><li>HICP +0.1% m/m</li><li>Prior -0.3%</li></ul><p style=““ class=“text-align-justify“>That’s now five months running that annual inflation in Spain has been on the decline, since peaking at 10.8% in July. The drop is surely still largely to do with falling energy prices, with <a target=“_blank“ href=“https://www.forexlive.com/news/milder-weather-has-helped-with-europes-plight-so-far-this-winter-20221228/“ target=“_blank“ rel=“follow“>milder weather conditions</a> so far this winter being a key reason for that in Europe. If there is something to take away from this report, it is that other countries in the euro area are likely to see a similar trend.</p>

This article was written by Justin Low at www.forexlive.com.