China’s Housing Market Slips Further in August Despite Policy Support: Price Declines Extend to Tier-One Cities

Economic

Summary:

China’s new home prices fell 0.3% in August for the second straight month, reinforcing concerns that the prolonged property downturn remains a significant drag on economic recovery....

Persistent Decline Reflects Enduring Weakness in Housing Demand

China’s real estate sector remains entrenched in decline, as official data released Monday showed that new home prices fell by 0.3% in August from the previous month. This marks the fourth consecutive month of contraction and mirrors the decline recorded in July. On a year-on-year basis, prices dropped 2.5%, a slight improvement from the 2.8% fall in July but still reflective of a broader systemic weakness.

The data, derived from the National Bureau of Statistics and compiled by Reuters, confirms that housing remains a major impediment to growth in the world’s second-largest economy. The trend has persisted since May 2023, despite multiple policy interventions.

Nationwide Weakness Across Tiers and Regions

Among the 70 cities surveyed, 57 saw month-on-month price declines, and 65 recorded annual decreases. Notably, resale prices a key measure of real market sentiment fell sharply. Tier-one cities posted a 3.5% drop year-on-year, while tier-two cities fell 5.2% and tier-three cities, the most fragile segment, declined 6.0%.

This widespread weakness is partly a consequence of oversupply in lower-tier cities and depressed buyer confidence nationwide. As secondary-market listings remain high and household income expectations falter, even relaxed purchase restrictions have not reignited demand.

Investment and Sales Continue to Slide

Property investment fell 12.9% year-on-year in the first eight months of 2025, highlighting a severe contraction in developer activity. At the same time, floor space sales a proxy for transaction volume slid 4.7% over the same period.

These figures reveal a sector caught in a downward spiral. Developers are scaling back, new project launches are being delayed or shelved, and consumers are staying on the sidelines. The interplay of these dynamics is contributing to deflationary pressures and suppressing broader economic momentum.

Policy Easing Yet to Deliver Results

Local governments in cities like Shanghai and Shenzhen have responded by easing homebuying restrictions in selected districts for qualified buyers. These adjustments are part of broader efforts to support market stabilization through targeted deregulation.

However, the central government remains cautious. Premier Li Qiang reaffirmed in August that “forceful measures” are necessary to consolidate the market’s fragile stabilizing trend. Yet thus far, actions such as mortgage rate cuts and urban village renovation programs have failed to yield a sustained turnaround.

The lack of a coordinated national rescue package may reflect Beijing’s desire to avoid fueling speculative bubbles. However, the piecemeal nature of local easing policies has limited their effectiveness in reviving confidence or addressing inventory overhang.

Stabilization Expected in Late 2026 or Beyond

Most analysts surveyed by Reuters now believe that housing market stabilization will not occur before the second half of 2026 or even into 2027 a significant revision from expectations just three months earlier. This adjustment suggests growing pessimism about the pace of recovery and the structural nature of the property downturn.

Factors such as high youth unemployment, stagnant wage growth, and demographic shifts are dampening long-term demand. These are not merely cyclical pressures but reflect deeper transformations in China’s urban economy and household behavior.

A Sector in Need of Stronger Intervention

China’s housing market continues to be a drag on the country’s post-COVID economic rebound. Despite policy support and marginal easing in major cities, the August data shows no sign of meaningful recovery. With investment and sales still falling and sentiment weak across tiers, real estate remains a key macroeconomic risk.

Unless Beijing adopts a more unified and aggressive policy stance potentially including broader financing support, developer restructuring, or demand stimulation the sector could continue to weigh heavily on China’s broader growth trajectory well into 2026 and beyond.

Source: Reuters

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What happened in the U.S. session?

The U.S. overnight session was characterized by mixed inflationary signals that reinforced Fed easing expectations while maintaining caution about the pace of cuts. The August CPI’s 0.4% monthly rise exceeded expectations but was offset by deteriorating labor market conditions, creating a complex environment for policymakers.

What does it mean for the Asia Session?

Asian traders should prepare for a potentially volatile but opportunity-rich session driven primarily by Fed rate cut expectations. The anticipated dollar weakness creates favorable conditions for Asian assets, while divergent regional central bank policies offer tactical trading opportunities. Key focus areas include Japanese trade data, currency positioning ahead of the Fed meeting, and continued monitoring of China’s economic trajectory. Geopolitical developments remain a wildcard that could override fundamental factors, particularly in commodity markets.

The Dollar Index (DXY)

The US Dollar enters the week of September 16, 2025, facing its most significant policy inflection point since late 2024. With the Fed widely expected to begin its easing cycle amid clear labor market deterioration, the dollar confronts both cyclical and structural headwinds. Technical indicators suggest further weakness ahead, with key support levels now in focus. While short-term positioning has stabilized, the fundamental backdrop of diverging global monetary policies and domestic political pressures points to continued dollar vulnerability in the near term.

Central Bank Notes:

● The Board of Governors of the Federal Reserve System voted unanimously to maintain the Federal Funds Rate in a target range of 4.25% to 4.50% at its meeting on July 29–30, 2025, keeping policy unchanged for the fifth consecutive meeting.

● The Committee reiterated its objective of achieving maximum employment and inflation at the rate of 2% over the longer run. While uncertainty around the economic outlook has diminished since earlier in the year, the Committee notes that challenges remain and continued vigilance is warranted.

● Policymakers remain highly attentive to risks on both sides of their dual mandate. The unemployment rate remains low, near 4.2%–4.5%, and labor market conditions are described as solid. However, inflation remains somewhat elevated, with the PCE price index at 2.6% and a core inflation forecast of 3.1% for year-end 2025, up from earlier projections; tariff-related pressures are cited as a contributing factor.

● The Committee acknowledged that recent economic activity has expanded at a solid pace, with second-quarter annualized growth estimates near 2.4%. However, GDP growth for 2025 has been revised downward to 1.4% (from 1.7% projected in March), reflecting expectations of a slowdown in the coming quarters

● In the revised Summary of Economic Projections, the unemployment rate is expected to average 4.5% in 2025, and headline PCE inflation is forecast at 3.0% for the year, with core PCE at 3.1%. Policymakers continue to anticipate that inflation will moderate gradually, with ongoing risks from tariffs and global conditions.

● The Committee reaffirmed its data-dependent and risk-aware approach to future policy decisions. Officials stated they are prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede progress toward the Fed’s goals.

● As previously outlined, the Committee continues the measured run-off of its securities holdings. The pace of balance sheet reduction, which slowed since April (monthly redemption cap on Treasury securities reduced from $25B to $5B, while holding agency MBS cap steady at $35B), was left unchanged this month to support orderly market functioning and financial conditions.

● The next meeting is scheduled for 16 to 17 September 2025.

Next 24 Hours Bias

Weak Bearish

Gold (XAU)

Gold enters Monday, September 15, 2025, in a strong fundamental position, supported by imminent Federal Reserve rate cuts, robust central bank demand, and ongoing geopolitical uncertainties. The combination of technical momentum near record highs and favorable macroeconomic conditions suggests continued bullish sentiment, with key resistance at $3,675 representing the next major hurdle. China’s regulatory streamlining adds another positive catalyst for medium-term demand, while the Fed’s decision on Wednesday will likely determine whether gold can sustain its breakout to new all-time highs above $3,700.

Next 24 Hours Bias

Strong Bullish

The Australian Dollar (AUD)

The Australian Dollar is experiencing its strongest period in nearly a year, driven primarily by expectations of aggressive Federal Reserve easing rather than purely domestic factors. While technical indicators suggest continued upward momentum, the currency faces potential headwinds from China’s economic challenges and upcoming domestic employment data. The RBA’s September meeting is expected to maintain the status quo, with officials taking a data-dependent approach to future policy decisions.

Central Bank Notes:

● The RBA held its cash rate steady at 3.60% at its September meeting on 8–9 September 2025, following a 25 basis point reduction at the August meeting. This maintains a cautious yet supportive stance, with the decision largely anticipated given recent evidence of inflation settling within the target band.

● Inflation readings continue to ease, with headline CPI most likely tracking near 2.1–2.3%—comfortably within the 2–3% target range. September quarter figures are pending, but leading indicators show further moderation in non-housing components, even as insurance and housing-related costs remain sticky.

● The RBA’s preferred trimmed mean inflation is estimated at around 2.7%–2.9%, further reflecting progress toward the midpoint of the target range. Energy and food volatility still create some short-term uncertainty, but underlying inflation is broadly on track.

● Global conditions are a key source of risk. While U.S.–EU trade tensions have stabilized slightly, volatility in equities and commodities persists, with uncertainty feeding through to Australia’s trade and export outlook.

● Domestic demand shows tentative improvement. Real household incomes and a stabilizing housing sector have underpinned modest consumption growth, though business investment remains uneven—service sectors outperforming manufacturing and construction.

● Labor market tightness persists, but momentum continues to slow from earlier in the year. Employment gains remain, but job vacancies and hiring intentions have softened, with underutilization rising marginally for the second straight month.

● Wage growth has slowed in line with easing labour pressures, but unit labour costs remain elevated due to weak productivity. The RBA continues to flag subdued productivity as a medium-term cost risk.

● Forward indicators suggest household consumption may be softer than previously forecast. Elevated rents and high borrowing costs are dampening discretionary spending, despite modest income recovery.

● The Board continues to highlight the risk that household spending could underperform, potentially weighing on business investment and job creation if confidence remains subdued.

● Monetary policy remains mildly restrictive, in line with greater inflation control and ongoing economic rebalancing. The decision to hold rates recognizes both progress and ongoing uncertainties, with future moves explicitly tied to incoming data.

● The Reserve Bank reinforced its goals of price stability and full employment, stating readiness to adjust policy if economic or inflation outcomes diverge from baseline projections.

● The next meeting is on 29 to 30 September 2025.

Next 24 Hours Bias

Medium Bullish

The Kiwi Dollar (NZD)

The New Zealand Dollar remains under pressure from dovish domestic monetary policy, with the RBNZ signaling further rate cuts to support the struggling economy. While global factors such as US Dollar weakness and positive China trade data have provided some support, the fundamental outlook for New Zealand continues to show economic weakness with declining GDP, rising unemployment, and contracting manufacturing activity. The currency’s trajectory will largely depend on the pace of the RBNZ’s easing cycle and broader global monetary policy developments, particularly from the Federal Reserve. Market participants should monitor upcoming GDP data and employment figures, which will be critical in determining whether the central bank delivers the expected additional 50 basis points of cuts by year-end.

Central Bank Notes:

● The Monetary Policy Committee (MPC) agreed to cut the Official Cash Rate (OCR) by 25 basis points to 3.00% on 20 August 2025, marking a three-year low and continuing the easing cycle after July’s pause. The vote was split 4-2, with two members advocating a 50-basis-point cut, highlighting diverging views within the Committee.

● Policymakers indicated that significant uncertainty and a stalling economic recovery prompted this move, leaving the door open for further rate cuts later in the year, with a possible trough around 2.5% by December.

● Annual consumer price index inflation rose to 2.7% in the June quarter and is expected to reach 3% for the September quarter—at the upper end of the MPC’s 1 to 3% target band—but medium-term expectations remain anchored near the 2% midpoint.

● Despite the near-term uptick, headline inflation is projected to return toward 2% by mid-2026, as tradables inflation pressures ease and significant spare capacity continues to dampen domestic price momentum.

● Domestic financial conditions are broadly aligning with MPC expectations, as lower wholesale rates have translated into reduced borrowing costs for households. However, declining consumption and investment demand, higher unemployment, and subdued wage growth reflect ongoing economic slack.

● GDP growth stalled in the second quarter of 2025, contrasting with earlier projections. High-frequency indicators point to continued weakness driven by rising prices for essentials, weakening household savings, and constrained business lending.

● The MPC cautioned that ongoing global tariff uncertainties and policy shifts, especially recent changes in US trade regulations, could amplify market volatility and present both upside and downside risks to New Zealand’s recovery.

● Subject to medium-term inflation pressures continuing to ease as projected, the MPC signaled scope for further OCR cuts, possibly down to 2.5% by year-end, consistent with the latest Monetary Policy Statement outlook.

● The next meeting is on 22 October 2025.

Next 24 Hours Bias

Medium Bearish

The Japanese Yen (JPY)

The Japanese yen faces a complex environment on September 15, 2025, with political uncertainty from Prime Minister Ishiba’s resignation creating short-term headwinds despite improving economic fundamentals. Manufacturing sentiment has reached three-year highs following the US-Japan tariff deal, and business confidence is turning positive across major firms. However, the upcoming BoJ meeting on September 18-19 will be crucial for determining the central bank’s policy direction amid persistent inflation above the 2% target and ongoing global trade uncertainties.Central Bank Notes:

● The Policy Board of the Bank of Japan decided on 31 July, by a unanimous vote, to set the following guidelines for money market operations for the inter-meeting period:

● The Bank will encourage the uncollateralized overnight call rate to remain at around 0.5%.

● The BOJ will maintain its gradual reduction of monthly outright purchases of Japanese Government Bonds (JGBs). The scheduled amount of long-term government bond purchases will, in principle, continue to decrease by about ¥400 billion each quarter from January to March 2026, and by about ¥200 billion each quarter from April to June 2026 onward, targeting a purchase level near ¥2 trillion in January to March 2027.

● Japan’s economy is experiencing a moderate recovery overall, though some sectors remain sluggish. Overseas economies are generally growing moderately, but recent trade policies in major economies have introduced pockets of weakness. Exports and industrial production in Japan are essentially flat, with any uptick largely driven by front-loaded demand ahead of U.S. tariff increases.

● On the price front, the year-on-year rate of change in consumer prices (excluding fresh food) remains in the mid-3% range. This reflects continued wage pass-through, previous import cost surges, and further increases in food prices, particularly rice. Expectations for future inflation have begun to rise moderately.

● The effects of the earlier import price and food cost increases are expected to fade during the outlook period. There may be a temporary stagnation in core inflation as overall growth momentum softens.

● Looking forward, the economy is likely to see a slower growth pace in the near term as overseas economies feel the pinch of ongoing global trade policies, putting downward pressure on Japanese corporate profits. Accommodative financial conditions are expected to buffer these headwinds somewhat. In the medium term, as global growth recovers, Japan’s growth rate is also expected to improve.

● With renewed economic expansion, intensifying labor shortages, and a steady rise in medium- to long-term expected inflation rates, core inflation is projected to gradually pick up. By the latter half of the BOJ’s projection period, inflation is forecast to move in line with the 2% price stability target.

● The next meeting is scheduled for 17 to 18 September 2025.

Next 24 Hours Bias

Weak Bearish

Oil

Oil markets on Monday, September 15, 2025, face a challenging outlook characterized by modest OPEC+ production increases aimed at market share recovery, robust supply growth outpacing demand, and mixed inventory signals. While geopolitical tensions continue to provide price support, the underlying fundamentals suggest potential for further price weakness as anticipated supply surpluses materialize in 2026.Next 24 Hours Bias

Medium Bullish

Source: IC Markets

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[Quick Facts]

♦ Trump reiterates call for Cook's dismissal on eve of FOMC

♦ Blackstone star emerges as Fed-Chair dark horse in power play

♦ U.S.–U.K. tech accord targets AI, quantum, critical chips in strategic pact

♦ Trump demands NATO quit Russian oil, floats China tariff escalation

[News Details]

Trump Reiterates Call for Cook's Dismissal on Eve of FOMC

On Washington, Sept. 14 — President Donald Trump filed a final brief with the U.S. Court of Appeals on Monday, seeking leave to remove Fed Governor Lisa Cook for alleged mortgage fraud. The administration aims to complete the termination before next week's FOMC rate decision, reiterating that Governor Cook has failed to mount a credible defense against the charges.

Blackstone Star Emerges as Fed-Chair Dark Horse in Power Play

A senior U.S. administration official disclosed that Rick Rieder, senior executive at Blackstone Group, has been climbing steadily on the shortlist to succeed as Fed Chair. Earlier last week Rieder told CNBC that, based on his read of economic indicators, the Fed should cut rates by 50 bps—double the reduction markets widely expect to be announced at this week's FOMC meeting.

Additionally, U.S. Treasury Secretary Scott Bessent conducted a two-hour wide-ranging interview with Rieder in New York last Friday, covering monetary policy, the Fed's organizational structure, and supervisory policy. Bessent particularly valued Rieder's ability to assess the economy through a forward-looking framework rather than relying on lagging data. Rieder stated bluntly during the discussion that a 25 bps adjustment to the overnight funding rate lacks real impact. The Fed, he argued, should instead focus on how to deploy balance-sheet tools, liquidity-management instruments, and yield-curve positioning strategies.

U.S.–U.K. Tech Accord Targets AI, Quantum, Critical Chips in Strategic Pact

The British embassy in Washington said Saturday that London and Washington are poised to sign a landmark technology agreement in the coming days as part of President Trump's visit to the UK. The accord is designed to deepen collaboration between the two nations' multi-trillion-dollar tech sectors, unlocking opportunities for businesses and consumers on both sides of the Atlantic. The partnership will focus on critical technologies including artificial intelligence, semiconductors, telecommunications and quantum computing, according to the embassy.

President Trump is scheduled to depart for the U.K. on Tuesday for a three-day second state visit, accompanied by a delegation of senior U.S. executives that includes Nvidia CEO Jensen Huang and OpenAI's Sam Altman.

Trump demands NATO quit Russian oil, floats China tariff escalation

U.S. President Donald Trump, in a September 13 letter to NATO members, urged the alliance to halt all purchases of Russian crude and endorsed bloc-wide sanctions on Moscow to terminate the war in Ukraine. In a concurrent social-media post Trump stated: "When every NATO nation agrees and acts in concert—ceasing all Russian oil imports—I am ready to impose sweeping sanctions on Russia." He further proposed that NATO collectively levy 50%–100% tariffs on Chinese goods to dilute Beijing's economic leverage over Moscow.

[Today's Focus]

UTC+8 17:00 Eurozone July Trade Balance (s.a.)

UTC+8 20:30 Canada July Wholesale Sales MoM

UTC+8 20:30 U.S. September Empire State Manufacturing Survey

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Gerik

Economic

Manufacturing and Consumption Falter as Economic Pressures Mount

China’s $19 trillion economy showed further signs of strain in August 2025, with key indicators signaling a broad-based slowdown. Industrial output grew by just 5.2% year-on-year the slowest pace since August 2024 falling short of both July’s 5.7% expansion and market forecasts. At the same time, retail sales grew only 3.4%, the weakest performance in nine months, reflecting subdued consumer sentiment and financial caution.

These figures point to a deeper cooling in both manufacturing activity and domestic consumption, underscoring the challenges facing policymakers as they attempt to maintain economic stability amid external shocks and internal structural weaknesses.

Structural Drag from Property and Labor Markets

The property sector remains a major source of economic drag. Home prices fell 0.3% month-on-month in August and declined 2.5% year-on-year. These declines reflect not only weak demand but also a broader erosion of household wealth. As property is the largest asset class for Chinese households, its prolonged downturn has curbed consumer spending and led to a tightening of household budgets.

The job market is also weakening. Unemployment rose to 5.3% in August, up from 5.2% in July and 5.0% in June. The rise in joblessness is linked to slower business activity and a loss of confidence among employers, especially in sectors such as construction, retail, and manufacturing. Businesses facing lower demand and squeezed profit margins are cutting labor costs, further suppressing household consumption in a negative feedback loop.

Investment Momentum Weakens Despite Policy Rhetoric

Fixed asset investment, a key driver of long-term growth, rose only 0.5% in the first eight months of 2025, well below the expected 1.4% and sharply lower than the 1.6% gain recorded through July. This slowdown highlights caution among both public and private investors in the face of macroeconomic uncertainty, despite central government pledges to accelerate infrastructure and industrial investment.

Policymakers face the dilemma of balancing stimulus with long-term stability. Authorities have already deployed targeted fiscal support and modest rate cuts, but analysts argue that these measures have not been sufficient to offset the broad-based cooling.

Weather Shocks Compound Economic Challenges

Adding to economic pressure, extreme weather has disrupted manufacturing and logistics. China experienced its hottest summer since 1961 alongside the longest rainy season in the same period, negatively affecting production schedules and supply chains in key industrial regions.

These climate-related disruptions have exacerbated the cyclical and structural challenges already weighing on China’s economy, reducing output efficiency and compounding inflationary concerns in certain sectors while weakening profitability in others.

Global Trade Diversification Yields Mixed Results

In response to U.S. President Donald Trump’s unpredictable trade policies, Chinese manufacturers have increasingly shifted export flows toward Southeast Asia, Africa, and Latin America. While this redirection has offered some relief, it has not been enough to offset the persistent drag from subdued global demand and a declining property market at home.

China’s export diversification illustrates a strategic rebalancing, but it remains constrained by sluggish global growth and geopolitical friction. Export gains are further undermined by the strength of the dollar, supply chain instability, and localized competition in emerging markets.

Stimulus Expected, but Scope May Be Limited

Economists, including Lynn Song of ING, argue that while the strong start to 2025 gives Beijing some cushion, further fiscal and monetary easing will likely be required to meet the annual growth target of around 5%. Proposed measures include a possible 10 basis point interest rate cut and a 50 basis point reduction in the reserve requirement ratio (RRR) for banks.

Zheng Shanjie, head of China’s National Development and Reform Commission, emphasized last week that Beijing will "fully utilize" its policy tools in the second half of the year. He called for faster implementation of new financial instruments, greater flexibility in monetary policy, and more targeted stimulus to support infrastructure, innovation, and consumer lending.

Fragile Recovery at Risk Without Decisive Policy Action

China’s economic performance in August highlights a growing divergence between early-year momentum and mid-year fragility. Domestic demand remains tepid, employment conditions are worsening, and the once-reliable property sector continues to weigh on confidence and investment.

While modest gains in exports and industrial diversification provide some relief, they are insufficient to anchor growth without robust domestic consumption. Unless Beijing introduces stronger and more coordinated fiscal-monetary support in the coming weeks, the risk of missing the 2025 growth target will rise, potentially destabilizing broader regional recovery efforts and global trade flows.

Source: Reuters

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Samantha Luan

Forex

Economic

China’s economic activity slowed more than expected for a second straight month with a sharp slump in investment, adding to the likelihood that policymakers will roll out more stimulus to ensure growth stays on track to hit the official target.Production at Chinese factories and mines expanded 5.2% last month from a year earlier, according to data released by the National Bureau of Statistics on Monday, compared with July’s gain of 5.7%. The median forecast of economists in a Bloomberg survey was for an increase of 5.6%.“The economy was generally stable” in August, the NBS said in a statement. But “there are still plenty of instability and uncertainties with the external environment, and the economy still faces many risks and challenges.”

Retail sales grew 3.4% on year in August, slower than an expectation for an increase of 3.8% and down from 3.7% in the previous month.Expansion in fixed-asset investment in the first eight months of the year decelerated sharply to 0.5%, the worst reading for the perid since 2020. The surveyed urban unemployment rate deteriorated to 5.3%.The data “confirms a sharp slowdown in the second half of 2025, especially on the investment side,” said Carlos Casanova, senior Asia economist at Union Bancaire Privee in Hong Kong.

With a boom in exports cooling off, many analysts and investors expect a downshift in China’s economy during the final months of 2025 after it clocked growth of 5.3% in the first half. The extent of the deceleration in China, set to be the top contributor to global growth over the next five years, will matter to a vulnerable world economy that’s slowing under pressure from Donald Trump’s tariffs.The economy’s surprisingly upbeat performance in the first half of the year has left China’s leadership confident of reaching the official growth target of around 5% even in case of a relatively pronounced slowdown later in the year. So far, policymakers have shown little sign of preparing major new stimulus as exports prove resilient during Trump’s second trade war.

Yet new challenges are emerging, as evidenced by a series of disappointing data readings in recent weeks.A broad measure of credit slowed last month for the first time this year, while export growth fell short of forecasts and dropped to 4.4% in August. The labor market also likely weakened in recent months, based on purchasing managers’ index surveys and private polls.Another source of pressure for the economy is the government’s “anti-involution” campaign that aims to ease overcapacity and excessive competition among companies. The effort escalated in early July and may have contributed to a fall in output that month for products ranging from steel to copper.

Even though traders have pushed equities higher in anticipation that the measures will restore profitability across the economy, the government still risks hurting employment and consumption in the absence of a major stimulus package for demand.How the campaign unfolds remains highly uncertain, making it difficult to judge when China might be able to break the grip of entrenched deflation.

Source: Bloomberg Europe

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Political

Key points:

● Hami Nepal used Discord app to mobilize protests

● Sudan Gurung and team propose cabinet changes, focus on youth involvement

● Protests against corruption lead to 72 deaths, over 1,300 injured

A former DJ and his obscure Nepalese non-profit used a social media app popular with video gamers to drive massive protests and become the unlikely power brokers in installing the country's new interim leadership.Sudan Gurung, the 36-year-old founder of Hami Nepal (We are Nepal), used the Discord messaging app and Instagram to mobilise massive demonstrations that forced Prime Minister K.P. Sharma Oli to resign, in the deadliest political crisis to hit the Himalayan nation in decades, a dozen people involved in the demonstrations said.

The group used VPNs to access banned platforms and issued calls to action that reached tens of thousands of young people, they added. Representatives for Oli could not be contacted for comment."I was invited to join a group on Discord where there were about 400 members. It asked us to join the protest march a few kilometres from the parliament," 18-year-old student Karan Kulung Rai, who is not part of the group, told Reuters.

Hami Nepal's early social media posts on Discord became so influential that they were referenced on national television.As protests grew violent, the group also identified messages it termed "fake news" and shared hospital phone numbers.Hami Nepal members, who asked not to be identified as they had used proxy names online for security reasons, said Gurung and the group's other leaders have since become central to high-stakes decisions, including the appointment of the new interim leadership till elections are held on March 5.

They have already convinced the country's president and army chief to appoint former Chief Justice Sushila Karki, known for her tough stance against corruption, as Nepal's first woman prime minister in an interim capacity, three members of the group said."I will make sure that the power lies with the people and bring every corrupt politician to justice," Gurung said in his first press conference since the protest on Thursday.On Sunday, Gurung and his team were in meetings to decide key cabinet positions and were proposing that some government officials appointed by the previous administration be removed, members of Hami Nepal said."Meetings are ongoing between Karki and members of the group. We will finalise the cabinet soon," one of the members said. Gurung and Karki did not immediately respond to questions sent to their mobile phones.The "process is being carefully carried out, so that it consists of skilled and capable youth," Hami Nepal said on Instagram.

FROM DJ TO REVOLUTIONARY

Monday's protest by young adults loosely categorised as a "Gen Z" movement, as most participants were in their 20s, turned deadly within hours and rapidly brought down the government.

The protests were directed at perceived government corruption and took off following a ban on multiple social media platforms - a directive that was reversed. Protesters clashed with authorities on the streets, leaving at least 72 dead and over 1,300 injured.Gurung, who is older than the Gen Z age bracket, and his team have vowed not to take up any cabinet positions but want to be part of the future decision-making."We don't want to be politicians. Sudan Gurung was only helping the 'Gen Z' group and we are only the voice of the nation and not interested in taking leadership positions," said Ronesh Pradhan, a 26-year-old volunteer for the group.

Gurung, who was a DJ before he founded Hami Nepal, organised civic relief when the worst earthquake in Nepal's history killed over 9,000 people in 2015, and during the COVID-19 pandemic.Team members running the Instagram account, whose followers have swelled to over 160,000, and Discord posts alongside Gurung include 24-year-old cafe owner Ojaswi Raj Thapa and law graduate Rehan Raj Dangal.Thapa, who quickly emerged as a vocal protest movement leader, told Reuters in an interview that the judiciary was not independent and ensuring its freedom was a key priority once the interim government was put in place."We may need some changes to the constitution but we don't want to dissolve the constitution," he said on Thursday.

Source: TradingView

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Forex

Macro hedge funds have increased bets on the Australian dollar, boosting exposure to options that pay off if the currency continues climbing against major peers, traders say.The Aussie logged its two busiest days of option activity versus the dollar last week since late July, Depository Trust & Clearing Corporation data show. On both days, call option volume — contracts that profit when the currency rises — was triple that of puts, with trades of A$150 million ($100 million) or more. The surge came as the Australian dollar touched its strongest level against the greenback since November.

“We have seen sustained interest for AUD call options versus other currencies as the macro community looks to accumulate positions for a potential breakout,” said Ivan Stamenovic, head of Asia Pacific G-10 FX trading at Bank of America Corp.The Australian dollar is September’s second-best performing major currency, trailing only Norway’s krone. Macro funds are betting its outperformance will extend in the weeks ahead, fueled by resilient household spending, stronger-than-expected growth, rising commodity prices and hawkish Reserve Bank of Australia signals. Governor Michele Bullock said earlier this month that robust consumer demand may limit the scope for rate cuts.

Macro funds aren’t just wagering on the Aussie against the greenback. The currency has also climbed to multi-month highs versus other Group-of-10 peers.Against the Canadian dollar, the Aussie is at its strongest since November, buoyed by weak Canadian growth and labor data. Those reports pushed traders to price in higher odds of a Bank of Canada quarter-point rate cut on Sept. 17. On one of the busiest Aussie dollar option days last week, every trade larger than A$50 million versus the Canadian dollar was a call option, the DTCC data show.

The Aussie has also reached its highest since mid-June against the Swiss franc, after Swiss National Bank President Martin Schlegel signaled the central bank would not hesitate to push rates back below zero if needed.“We have seen interest from hedge funds to express a bullish AUD/USD view via AUD call options in the last two weeks,” said Troy Fraser, head of foreign-exchange sales for Australia and New Zealand at Citigroup Inc. in Sydney. “AUD/CAD and AUD/CHF have also been popular pairs to express this bullish Australian dollar view.”