Forex news for Asia trading Tuesday 12 July 2016
- RBA's Ellis: Speech on financial stability - nothing on mon pol nor economy
- More from Fed's Mester: Need to consider Brexit impact in medium term outlook
- Japan fin min Aso: Will consider stimulus package as soon as Abe orders it
- Japan chief cabinet secretary Suga: Doesn't know the scale of the economic package
- Fed's Mester in Q&A now: Positive on US jobs market
- Moody's says Brexit to negligible impact on GCC sovereigns
- Bundesbank's Dombret: No liquidity provisioning was necessary after Brexit
- Japan economy minister Ishihara: Mindful of Brexit fallout in stimulus spending
- Australia: June NAB Business Conditions 12 (prior 10) & Confidence 6 (prior 3)
- PBOC sets USD/CNY central rate at 6.6950 (vs. yesterday at 6.6843)
- Japan PM Abe is said to be meeting with Bernanke in Tokyo today
- Survey finds Australian business confidence higher in June
- Overnight Australian press: Strategist says AUD "way over-valued"
- Japan PPI (June): -0.1% m/m (expected -0.1%) and -4.2% y/y (expected -4.2%)
- Exxon Mobil says no attacks at its facilities
- Australia - ANZ Roy Morgan Weekly Consumer Confidence, 115.2 (prior 115.8)
- UK data - BRC sales data for June: -0.5% y/y (prior +0.5% y/y)
- Overnight news (view) - RBA has room to cut, AUD overvalued
- New UK PM Theresa May caves in on key appointment after rat threat
- NZD orderboard
- AUD orderboard
- IMF on Italian banks and EU rules
- Nigerian oil strike - update
- Morgan Stanley says to stay long EUR/GBP into the Bank of England meeting
- Trade ideas thread - Tuesday 12 July 2016
Another day of Nikkei strength and yen weakness on stimulus hopes from Japan. The Nikkei surged again, but has since lost some ground. It fell away a little when Economics Minister Ishihara said he hadn't received any instructions on stimulus from Prime Minister Abe, along with a report from the Nikkei saying the new stimulus package is not expected until August and a supplementary budget required to pay for it all to go the the parliament in the September session. Japan may be able to snatch defeat from the jaws of victory yet again!
Former Federal Reserve chair Ben Bernanke met with BOJ Governor Kuroda yesterday and is thought to be meeting with PM Abe today; its likely he'll be advising further stimulus, both fiscal and monetary, though we haven't heard from either of these 3 publicly on the meetings.
USD/JPY popped above overnight highs and to near 103.30 before it backed off a few points.
Other currencies were not left out of the moves, with yen cross activity playing a part in EUR and GBP strength (and others). The CHF weakened early in the session, USD/CHF above 0.9850 before it fell back to be more or less unchaged on the session as I update.
AUD has its own specific input, with the NAB monthly business survey showing improving business conditions and confidence, even though the survey was conducted in the midst of Brexit vote financial market volatility and acrimonious election campaigning in Australia. The big positives are a result which augur well for employment. AUD/USD moved strongly higher, up around 60-odd points until running into resistance/big sellers we had highlighted earlier in the session around 0.7590/00. NZD went along for the ride, popping above 0.7260. Both AUD and NZD have since come just a little off from their highs.
Gold is little changed, oil has recovered around half a dollar on the session.
Regional equities:
- Nikkei +2.91%
- Shanghai flat
- HK +0.48%
- ASX +0.89%
(ps. The New Zealand NZX 50 hit a new record high today)
