Markets Overview
- ASX SPI 200 futures up 0.3% to 7,204.00
- Dow Average up 0.4% to 33,716.73
- Aussie up 0.7% to 0.6772 per US$
- U.S. 10-year yield rose 7.4bps to 3.4910%
- Australia 3-year bond yield fell 0.7 bps to 3.06%
- Australia 10-year bond yield rose 1 bp to 3.37%
- Gold spot up 0.2% to $1,789.95
- Brent futures down 1.2% to $76.26/bbl
Economic Events
- 11:00: (AU) Australia to Sell A$700 Million 0.25% 2025 Bonds
- Australian government will hold auctions for A$10 billion worth of new renewable energy generation and storage, as it seeks to replace rapidly closing coal plants.
The first in-person negotiating round for an economic pact the US hopes will build Indo-Pacific trade links and counter China’s influence in the region takes place in Australia this weekend, with Washington seeking progress on critical areas such as trade facilitation and agriculture.
Officials from 14 member countries — which represent 40% of global gross domestic product — will gather in Brisbane on Dec. 10 to discuss developments in the Indo-Pacific Economic Framework — launched by President Joe Biden in May. It’s the most significant US economic engagement in the region since former President Donald Trump abandoned the Trans-Pacific Partnership, negotiated under former President Barack Obama.
It focuses on four pillars that seek to increase trade links, strengthen global supply chains, promote infrastructure investment and decarbonization, and establish new rules on tax and anti-corruption.
The US has shared the text for discussion on the second pillar on supply chains, as well as the fourth on tax and anti-corruption issues, an administration official told reporters Wednesday. A concept paper on the third area relating to investment and good regulatory practices is also ready. A separate chapter on digital-economy rules involving data localization and flows will be ready in the new year, a separate official said.
One of the officials said the IPEF partners — which include India, Japan, South Korea and New Zealand — are working at a fast pace and have been making concrete progress since ministers of member nations convened in Los Angeles in September. Last month, US Trade Representative Katherine Tai said an agreement is possible within the next two years.
Some lawmakers and business executives have criticized Biden’s IPEF for stopping short of reducing tariffs — something accomplished by the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, a successor to the TPP that does not include the US.
US allies in Asia would also have preferred a more traditional trade deal that offered greater access to US markets, but are considering the IPEF as the Biden administration’s offer.
Other News
South Korean lawmakers approved a measure that would revise the way the country tallies a person’s age, ending a system that counted newborns as a year old and meaning that most of its citizens are about to get younger.
The bill passed by the National Assembly on Thursday would scrap the country’s widely used “Korean age” counting standard, which typically added a year or even two to a person’s age compared to the counting system used in most of the world, that starts the clock at zero and begins counting years on the next birthday.
President Yoon Suk Yeol sought the change when he ran for office this year and the move is set to take effect in June. His government has said removing the Korean age system would prevent confusion in processing administrative and medical service.
“With the passage of the amendment today, all citizens of our country will become younger by one or two years starting next June,” Yoon’s office said after the bill’s passage.
The move would also prevent legal disputes surrounding the age system on signed contracts and make it easier for citizens who often have one age at home and another age as recognized by global standards.
Historians have trouble pinpointing a government decree for the current system seen as a remnant of the ancient culture of Korea, China and Japan. That system grouped all babies to the year they were born, and they then all turned a year older when the calendar clicked over. This meant a child delivered on Dec. 31 was considered a year old, and turned two the next day when the new year started.
North Korea got rid of the antiquated system in the 1980s and used the global standard.
The age system has caused strains in South Korean legal matters. For example, a “juvenile” under the law is a person under 19, but 19 is defined as a person who will not achieve the age of 19 at a date after Jan. 1 of that year.
The public has been on board for dropping the old system. About 80% of respondents to government-affiliated survey conducted in September wanted to end “Korean age” counting.
“It would be difficult to find the origin of such practice,” said Lee Gi-jung, a spokeswoman for the Ministry of Government Legislation. “But South Korea is the only one that has been keeping it due to its rank-based society.”
(Bloomberg)
