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Chinese factory gate inflation printed negatively for the first time since 2020 while headline inflation missed estimates both YoY and MoM. These figures suggest that China’s ‘zero tolerance’ COVID-19 policies have been curtailing inflationary pressures via restrained consumer demand. Commodity prices have also declined allowing for lower producer prices which leaves the commodity export forecast for Australia quite austere at this point.

Later today, we can expect further details from the U.S. midterm elections coupled with Fed speakers. U.S. inflation is the key data point this week and markets should remain relatively cautious until then.