Raises current year GDP outlook

*Asian Market Update:* Australia Q4 CPI disappoints, pushing back RBA
hike expectations; BOJ keeps economic assessment unchanged, raises
current year GDP outlook.

!! Economic Data !!
*- (AU) AUSTRALIA Q4 CPI Q/Q: 0.4% V 0.7%E (lowest level since Q1
2009); Y/Y: 2.7% V 3.0%E; RBA TRIMMED MEAN Q/Q: 0.3% V 0.7%E; Y/Y:
2.2% V 2.6%E*
*- (AU) AUSTRALIA NOV CONFERENCE BOARD LEADING INDEX:* 0.3% V 0.6%
PRIOR
*- (NZ) NEW ZEALAND DEC PERFORMANCE SERVICES INDEX:* 52.5 V 51.7 PRIOR
(3rd consecutive increase)
*- (PH) PHILIPPINES NOV TRADE BALANCE: -$798M V -$112M PRIOR; TOTAL
IMPORTS Y/Y:* 35.3% V 28.4% PRIOR
!! Markets Snapshot (as Of 12:00amET) !!
- Nikkei225 +1.1%
- S&P/ASX +0.5%
- Kospi +0.8%
- Taiex +0.7%
- Shanghai Composite -0.6%
- Hang Seng +0.5%
- Mar S&P Futures flat at 1,289
- Mar Gold -0.8% $1,333/oz
- Feb Crude oil -0.3% $88.56/brl
- Mar Copper -0.8% at $4.31
- Mar Wheat -1.1% at $8.26
!! FX USD Majors Session Range !!
- EUR/USD: 1.3625-1.3685
- GBP/USD: 1.5965-1.6015
- USD/CHF: 0.9470-0.9500
- USD/CAD: 0.9920-0.9945
- AUD/USD: 0.9930-0.9980
- NZD/USD: 0.7625-0.7665
- USD/JPY: 82.35-82.65

!! Overview/Top Headlines !!
- Asian equity markets are mainly higher, tracking the overnight 1%
gains in the Dow and the Nasdaq indices, while the less-correlated
Shanghai is the only declining market ahead of the Lunar New Year
holiday week. *Market consensus is firming up for the holiday season
to mark the next anticipated date for continued PBoC tightening* -
either in 1-yr key rates or another RRR move - particularly as fears
of food-driven inflation and excess bank lending return. Separately in
China, a *senior researcher at CASS think tank has spoken out against
backstopping EU debt,* also calling for China to continue *reducing
its US Treasury buying*. Recall the last TIC report showed China did
in fact become a seller of US debt, a retreat from firm buying
interest in recent months.

- *In most notable economic data, Australia Q4 CPI reflected the
disappointing PPI result overnight, falling to its lowest q/q level
since Q1 of 2009*. On an annualized basis, the headline 2.7% and RBA
trimmed mean 2.2% were also below consensus and well within the RBA
target range.

Speaking after the data, Treasurer Swan conceded the underlying
inflation has moderated in Q4, but *warned Q1 is expected to spike
because of flood-related higher food prices*. In the mean time, RBA
tightening expectations have been pushed back into the second half of
the year, with markets tuning in for the interest rate decision next
week for more detail on anticipated impact of the Queensland floods.
*- Bank of Japan left its target range of 0.0-0.1% unchanged as
expected, keeping economic assessment unchanged but raising its
FY10/11 GDP target to 3.3% v 2.1% prior as rumored in the press.* BOJ
also lowered its FY11/12 GDP target to 1.6% v 1.8% and FY12/13 GDP
target to 2.0% v 2.1% prior. On inflation, BOJ nudged its forecast
higher: FY10/11 core CPI guidance to -0.3% v -0.4% in Oct forecast and
FY11/12 core CPI guidance to 0.3% v 0.1% in Oct forecast.

!! Speakers/Geopolitical/In The Press !!
*- (CH) According to Chinese Academy of Sciences' (CASS) Center of
Forecasting, China avg housing prices to rise 12.8% y/y to CNY5.7K per
sqm in 2011; Also forecasted 3.7% increase in CPI on rising labor
costs, food driven inflation, and liquidity inflows - China Daily*
- (CH) According to a researcher at Distribution Productivity
Promotion Center of China Commerce, nation's retail sales to rise 15%
y/y in 2011 to over CNY17T as govt measures encourage expanded
domestic consumption - China Daily
- According to DRAMeXchange, contract prices for 1GB DRAM chips fell
to a 22-month low of $0.88 amid weak demand - Korean press
!! Equities !!
*- Teijin:* May report Q3 Op profit ¥20B v loss ¥31.4B last year -
Nikkei
*- Nikon:* Plans to double number of China sales offices - Nikkei News
*- SK Telecom:* Reports Q4 Net profit KRW361B v KRW404Be; Op profit
KRW453B v KRW508Be; Rev KRW3.2T v KRW3.2Te
*- Hyundai Motor:* Planning to invest KRW1T to build a diesel engine
plant in India - Korean Press
*- Newcrest Mining:* Reports Q2 gold production 722.8K ozs v 674.2K
ozs q/q; Lowers FY10/11 gold production guidance to 2.85M-2.95M ozs v
2.85M-3.0M ozs prior and copper production to 75-80K tons from 80-86K
tons prior
*- Oil Search:* Reports Q4 Oil and gas production 1.86 MMBOE v 2.2
MMBOE y/y; Rev $164.7M v $193M y/y
*- Acer: Taiwan Unit President Lin:* Expects 2011 netbook shipments to
increase y/y - DigiTimes
- *TXN: Reports Q4 $0.64 (adj) v $0.63e, R$3.5B v $3.5Be; -2.5%
afterhours* - AMGN: Reports Q4 $1.17 v $1.11e, R$3.84B v $3.8Be; +0.3%
afterhours
*- AXP:* Reports Q4 $0.94 (ex charge) v $0.97e, R$7.32B v $7.3Be;
-1.3% afterhours
*- CSX:* Reports Q4 $1.14 v $1.10e, R$2.8B v $2.7Be; +1.9% afterhours
- *VMW: Reports Q4 $0.46 v $0.44e, R$836M v $804Me; Guides initial
FY11 Rev $3.45-3.5B v $3.4Be; Cautious on macroeconomic environment,
FY op margin to stay flat y/y; -4.8% afterhours*
*- EK: Receives Notice of Initial Determination in ITC Patent
Infringement Action Against Apple and Research In Motion; -5.9%
afterhours*
!! M&A !!
*- AMGN:* Will Acquire BioVex, a Privately Held Biotechnology Company;
Acquisition Includes a Therapeutic in Phase 3 Clinical Trials for the
Treatment of Advanced Melanoma and Head and Neck Cancer; To pay up to
$1B
!! FX/Fixed Income/Commodities !!
*- USD/CNY:* (CH) PBoC sets yuan mid point at 6.5881 v 6.5813 prior
close (new high setting for Yuan since 2005 revaluation)
- *GLD: SPDR Gold Trust ETF daily holdings fall by 11.0 tons to
1,260.8 tons*
- (AU) Australia Newcastle coal exports -21% for week ending Jan.
24th; 20 Coal ships waiting
Source: Fxstreet.com