Forex news for Asia trading Thursday 13 October 2016
- US media report US Navy Tomahawk missiles strike into Yemen
- China trade balance USD terms out now: 41.99bn surplus (+53bn expected)
- USD/JPY smashed lower - down 60+ points from highs
- China Trade Balance for September: 278.4bn CNY (expected 364.5bn)
- PBOC sets USD/CNY central rate at 6.7296 (vs. yesterday at 6.7258)
- NZ budget surplus grows - fin min says gives choices on repaying debt, cutting taxes
- New Zealand - ANZ Consumer Confidence Index (October): +1.6% m/m (prior +2.8%)
- Australia - Consumer Inflation Expectations (October): 3.7% (prior 3.3%)
- Japan press reports BOJ likely to cut its CPI forecasts
- Move over China, Fitch says a housing slump is the #1 Australia credit risk
- GBP, AUD, NZD slipping into the Tokyo morning
- UK data - RICS House Price Balance (September): 17% y/y (expected +14%)
- Article not about trading (or is it?): Why deep learning is suddenly changing your life
- New Zealand press: RBNZ locks itself into a November cut
- New Zealand - Food Price index for September: -0.9% m/m (prior +1.3)
- China data coming today & next few days expected to show stabilisation, strength
- New Zealand - BusinessNZ Manufacturing PMI (September): 57.7 (prior 55.1)
- New Zealand - ANZ job ads for September: +0.3% m/m (prior +3.1%)
- Trade ideas thread - Thursday 13 October 2016
- Oil drops further- private inventory survey shows bigger build than expected
- Soc Gen's Kit Juckes say GBP/USD may fall to 1.15
- ECB's Mersch on US monetary policy - normalisation slower than expected
The back story for the session was the release of the FOMC Minutes. After 3 dissents at the meeting wanting a rate hike it was no surprise that the minutes would read a little more hawkish. The USD was selectively better bid in Asia to begin with, higher against the yen, AUD and NZD notably, while EUR, CHF and GBP held in relatively small ranges. Japanese press reported the BOJ was to lower its inflation forecasts (see bullets above).
We saw some data flow from New Zealand and Australia, non-market moving items generally and apart from that news flow was quiet (financial market news flow that is, US politics-related news flow was relentless, but more on that soon).
The major market focus for the session was September trade data from China. It showed a huge miss on exports, casting renewed shadow over global growth prospects. The market response was not swift, it took a few minutes, but when it came it was pronounced. USD/JPY fell, not overly quickly but in half an hour or so it had lost 100+ points from the session high. EUR/USD moved higher, adding around 30 points from its session low, while the CHF strengthened also, USD/CHF dropping a similar amount.
S&P500 futures saw falls in overnight Globex trade.
AUD and NZD had been overall weak on the session, AUD/USD has remained heavy, barely off session lows. While the NZD is not going to win any prizes for strength today it has managed to lift itself 20 odd points off the canvas.
Cable has been relatively sedate today, tracking out a 40 point range. Quiet compared to its recent moves during this timezone.
Gold gained during the session, up just shy of $10 from its session low.
Regional equities:
- Nikkei -1.07%
- Shanghai +0.01%
- HK -1.27%
- ASX -0.86%
More:
It was hard to ignore the news flow coming out of US politics during the US evening. More allegations of sexual impropriety against Republican nominee Donald Trump. Trump has denied the allegations and threatened to sue the New York Times. He has previously boasted of such behaviour so he may find his denials struggle with credibility. I don't know where this leaves his campaign, but he hasn't shown any signs of backing down so far.
