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The trade balance for Japan in December came in as a much bigger deficit than expected at Y-55.3bn versus an expected Y-42.3bn, exports fell sharply as the trade wars bit, exports to China fell 7% y/y while they rose 1.6% to the U.S.

US existing home sales tumbled 4.99M v 5.24M expected, down -6.4% v -1.5%. Mortgage data has been stronger in 2019 so perhaps housing numbers pick up in the coming months with the Fed being flexible on rates. 

China GDP growth of 6.4% in Q4,  lowest since the global financial crisis, full year 6.6% GDP matches consensus also. Economists expect Beijing to increase stimulus measures ahead. December Industrial production and retail sales came in better, employment worse.

The monthly Reuters tankan survey indicates Japanese manufacturer's sentiment falling to a 2 year low in January with the sentiment index at +18 from December's +23. This was third consecutive monthly fall for the manufacturers' sentiment index to a 2 year low. 

Industrial production continues to slide Eurostat reports, falling 1.7% more than the 1.5% fall expected, this is prior to the market turmoil of December and just at the start of Gilets Jaunes protests which are now in their ninth week. Last month was +0.1%; revised from +0.1%.

The U.S. jobs report for December a robust 312,000 new NFP jobs following revised November non farm payrolls of 161,000 new jobs with unemployment rising to 3.9% off 48 year lows. We are still digesting the effect trade wars on jobs with tensions affecting employers.

It is clear the collapse in oil prices has had unintended consequences. In Texas the Dallas Fed manufacturing index for December slid a massive 22.5 points to -5.1 from +17.6 in November. Texas buinesses are also being negatively impacted by the trade war.

The U.S. jobs report for November is expected to show a robust 200,000 new NFP jobs following revised October non farm payrolls of 237,000 new jobs with unemployment to stay at 48 year lows. We are still digesting the effect trade wars on jobs with tensions affecting employers.

With tariffs and trade wars front and center and the Huawei scandal the US trade deficit for October, the largest since 2008 in in focus. The US had a $55.5 billion deficit up from $54 billion in September with record imports. The deficit with China was $43.18 billion and is a record high.

Australia delivered a trade surplus for the tenth month in a row. Australia's a trade surplus was however lower than expected as signaled by the weaker than expected GDP with drought and mining affects.

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