Forex news for Asia trading Wednesday 14 September 2016
- ANZ on the PBOC's RRR - no cut coming
- CNH HIBOR jumps to a seven month high again
- "Don't Believe the Good Economic News About Brexit"
- M6.0 earthquake in Colombia
- China's NDRC announces August power consumption +8.3% y/y
- UBS wants to use artificial intelligence to help clients decide how to invest
- PBOC sets yuan reference rate for today at 6.6895 (vs. yesterday at 6.6726)
- Australia - Westpac consumer confidence (September): +0.3% m/m (prior +2.0%)
- From the RBNZ - print and stick on the fridge door
- Things that make you go "Hmmmmm ...". What are yours?
- Japan PM Abe: We are on the verge of escaping deflation
- Nomura on the USD/JPY range to watch ahead of September 21
- More China data to come - key financing info
- PIMCO's "New Neutral Yield Curve: A New Framework for the Bank of Japan"
- NZ data - Q2 BoP Current Account Balance: -945mln (expected -295m, prior 1306m)
- 8 charts on China's stimulus driven rebound
- Juncker to warn the EU faces a battle for survival
- NZ data - REINZ house sales for August -3.1% y/y (prior -10.1%)
- Hump day trade ideas thread - Wednesday 14 September 2016
- Oil prices get a bump higher after private inventory data
Yen the mover again in Asia today, weakening over the session within not a very large range. USD/JPY began its move higher in the Tokyo morning, from just under 102.50 to around 102.80 where it stabilised. The next leg up took USD/JPY to around 103.10 and its drifted back under 103 since then. There was very little in the way of fresh news, nor data.
Did I just say yen was the mover? I should probably add the yuan, specifically offshore (CNH). As we approach October 1, when China's currency is to be included in the IMF's SDR basket the PBOC are looking to keep the currency relatively stable. On the other hand, speculators want to wager that the yuan will weaken ... and so what we have been seeing is short sellers of offshore yuan (CNH). The PBOC jacked up overnight rates again today, they did so last week, taking the overnight CNH HIBOR above 5% and today, again, to above 8% to try to dissuade the shorts. The PBOC actions are also ahead of China holidays for the rest of this week.
EUR/USD and USD/CHF traded in subdued ranges. GBP/USD dipped under 1.3170 briefly before regaining all its slide to get back around 1.3195.
AUD/USD and NZD/USD ticked out small gains.
Winding the clock back a little, oil prices jumped early here (or late UNY time) after the release of private inventory data showed a smaller than expected build. The price retraced all its pre-data gain and has added net a few cents since.
Gold is pretty much flat on the session.
On the Chinese economy today, just noting this; August power consumption was up 8.3% y/y (it was + 8.2% y/y in July). The NDRC announced the rise, citing hot weather along with a low comparison base last year. They added data for the first eight months of the year; rising 4.2% y/y. There are some who say that the electricity consumption data is a better guide to Chinese economic growth than other, more closely watched data (such as industrial production, GDP and what have you). Adding weight to such a view is that Premier Li Keqiang has even advocated doing so in the past:
Anyway, just adding that out of interest.
Regional equities:
- Nikkei -0.40%
- Shanghai -0.59%
- HK +0.08%
- ASX +0.20%
Still to come
- Well, sort of, more like 'not to come': China is on holiday tomorrow and Friday, markets are closed and will reopen on Monday.
- And, during the London session, for the AUD traders - RBA speaker coming up during London time ( Guy Debelle, Assistant Governor (Financial Markets))
More:
If you've read down this far, the first bullet point above is ANZ's view on the PBOC being unlikely to cut any RRR, ANZ citing surging housing loans. Accompanying the piece from ANZ was this graph showing what they are talking about:
(Yikes... breaks out in cold sweat)
