The China Securities Journal, not citing a source,  says the timing is right for a rate hike this weekend.  It would be the second of the current tightening cycle.   Reuters reports,

“With reference to the central bank’s record of raising interest rates just ahead of the release of CPI, this weekend will provide a window for a possible policy change,” the newspaper said, without citing any source.

China’s CPI in November may have risen to a 27-month high of 4.7 percent from a year ago, according to a Reuters poll, up from a 4.4 percent pace in October.

The China Securities Journal has a fairly good track record in predicting policy moves. It reported on November 17 that the central bank would raise interest rates two days later. On the predicted date, it announced an increase in banks’ required reserves, not interest rates.

The Shanghai Composite is sitting around its 200-day moving average at 2,800, which, given the early stage of the tightening cycle,  will not hold, in our opinion.  Though most commodities will probably sell-off on a China rate hike,  crude and copper are the markets to watch. If crude holds, it would confirm the latest move is more secular than cyclical.