Forex news for Asia trading Friday 24 June 2016
It was all about the Brexit vote today in Asia. And what a day!
GBP/USD made a new 2016 high in the early goings on after polls closed, with 'on the day' opinion polls and then very early results pointing to a 'Remain' win.
Not to be.
As more results came in, the wins for 'Remain' were on poorer than expected margins, their losses worse than expected. Meanwhile, wins for 'Leave' were by better than expected margins and losses not as bad as expected.
For example:
- Sunderland expected to show heavy leave support - BBC
- Brexit - Newcastle expected to be marginal Remain win (BBC)
This trend continued. It was a string of 'misses' for Remain, and a string of 'beats" for Leave, if you want to put it that way:
- Regional numbers continue to show Leave ahead of models
As it became clearer that Leave was edging ahead GBP fell hard, down under 1.44 before bouncing somewhat (a huge 250+ point bounce, but in the context of what was to come, this was a small move!)
Further gains for 'Leave' saw losses again for GBP, cable to around 1.40, a bounce back to 1.45 or so ... and the wild moves continued.
- Brexit model now puts Leave ahead with 51.1%
- Market finally beginning to acknowledge the results again
- Model forecaster now puts chance of Leave winning at 97%
As I update GBP/USD is at a 30-year low around the mid 1.34 area (I shouldn't have blinked ... low 1.33s now), having had a huge slide.
While all this was going on, 'risk' elsewhere got smashed also.
AUD/USD, EUR/USD, NZD/USD, stock exchanges ... all much, much lower. Even the USD/CHF gained.
Yen and gold were beneficiaries, gold is up $70+ $100+ from session lows.
The yen is inflicting pain on Japanese authorities - its screamed higher, USD/JPY under 100 at one stage (lows just above 99) before a bounce and its around 101.50 , nope, 100.50, or so as I write.
Japanese finance minister Aso is to hold a press conference at 0415GMT - stay tuned for that. These guys have been hinting on intervention efforts for a long time now. The time may be approaching. We'll see, and we'll also see how effective they will be. I haven't tried standing in front a speeding freight train myself, but they have some luck
Regional equities:
- Nikkei -7.55%
- Shanghai -1.19%
- HK -4.21%
- ASX -3.6%
Still to come: Japan's Aso will hold news conference at 4.15 GMT
GBP monthly:
