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Morning bid: Xi’s electric | Reuters

Morning bid: Xi's electric |  Reuters
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Oct 24 (Reuters) – A look at the day ahead in Asian markets by Jamie McGeever

Chinese politics, Japanese politics.

Notable developments on both fronts over the past 48 hours will be the talk of Asian bourses on Monday – the former with longer-term economic ramifications and the latter could spark more immediate market fireworks.

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In Beijing, China’s Xi Jinping has secured a historic third term at the helm, making him the country’s most powerful ruler since Mao Zedong. His grip on the Communist Party – and the country – appears to be ironclad.

This was offered for public consumption on Saturday former President Hu Jintao was unexpectedly escorted out of the closing ceremony of the party congress. Video footage showed Hu sitting next to Xi looking distressed and confused.

Xi’s reshuffle can also see Central Bank Governor Yi Gang According to sources, he resigned and was replaced by former deputy governor Yin Yong. “The reform camp is almost gone,” says one.

In the meantime, Japan intervened in the foreign exchange market on Friday after the yen fell to a fresh 32-year low near 152.00 per dollar. However many dollars Tokyo sold, it was impressive – the greenback fell more than 7 yen to a low of 144.50 before ending the day around 147.50.

diagram

But it remains to be seen if this will turn the tide of yen selling or if the FX market will reload and go again. As long as the US-Japan monetary policy divide remains, traders will feel that long dollar/short yen trading is still juicy, despite the specter of Japanese intervention.

Although the intervention was a “success,” the dollar is 147.50 yen stronger today than it was when Tokyo last intervened, selling nearly $20 billion. 22. Then the dollar was just under 147.00 yen.

History shows that this is not over yet.

Key developments that could give markets more direction on Monday:

Australia PMIs (October)

Japan PMIs (October)

US, Europe PMIs (October)

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Reporting by Jamie McGeever in Orlando, Florida; Editing by Lisa Shumaker

Our standards: The Thomson Reuters Trust Principles.

The opinions expressed are those of the author. They do not reflect the views of Reuters News, which is committed to integrity, independence and freedom from bias under the Trust Principles.

Jamie McGeever

Thomson Reuters

Jamie McGeever has been a financial journalist since 1998, reporting from Brazil, Spain, New York, London and now back in the US. Focus on the economy, central banks, policy makers and global markets – especially FX and fixed income. Follow me on Twitter: @ReutersJamie

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