Forex and Bitcoin news for Asia trading Tuesday 3 July 2018
German politics:
- EUR gaining on news of agreement in German government
- German Chancellor Merkel and Interior Minister Seehofer reach compromise agreement
YUAN:
- Looks like intervention spotted in the yuan - big Chinese state-owned banks acting
- PBOC vice gov says is confident can maintain a basically stable yuan
- PBOC sets USD/CNY central rate at 6.6497 (vs. yesterday at 6.6157)
More:
- NZ finmin Robertson remarking now on poor NZ business confidence
- Australia Building permit approvals for May: -3.2% m/m(expected 0.0% m/m)
- Reuters report the Bank of Japan is likely to cut its inflation forecasts
- Japanese press says BOJ will cut its inflation forecast this month
- 2nd part of the BOJ's Q2 Tankan shows inflation expectations edge higher
- Australian weekly consumer confidence: 120.4 (prior 121.4)
- RBA preview (in the words of Daft Punk - One More Time)
- UBS on EUR/GBP - trade recommendation (long), target, stop
- NZD traders - the data fun don't be done, dairy auction coming up Tuesday
- NZD data - Q2 business survey: Business confidence -20 (vs -11 previously)
- Trade ideas thread - Tuesday July 3 edition!
OIL:
- Oh, while I'm posting on oil - stay tuned for the inventory data (big draw expected)
- An ICYMI on oil - Libya declared force majeure on some of its supplies
The EUR caught a bid late NY/very early Asia on fresh news that German Chancellor Merkel and Interior Minister Seehofer had reached a compromise agreement on migration issues that had threatened the relationship between the two partners in the governing coalition.
EUR/USD popped above 1.1640 and then tracked sideways around there for a few hours.
The next movement was in the yen. It weakened into the Tokyo morning . USD/JPY pushing above 111 and then above 111.10, but like its early pop yesterday the move was not sustained. Reuters reported, citing three unnamed sources, that the BOJ intends to cut its inflation forecast at the July meeting (this is not until July 30 and 31), which should confirm easy monetary policy for a good while to come and on the face of it a yen negative. The thing is though the rumour of the Bank of Japan cut in forecasts came over the weekend, so it was hardly fresh. USD/JPY rapidly gave back all its gain, USD/JPY back to 110.80 and its just above there as I post.
As USD/JPY fell the USD gained elsewhere, EUR/USD fell toward 1.1620, AUD, NZD, GBP, CHF, CAD all dropped a few points against the big dollar also. Much of these have retraced to various extents as the session has progressed.
It all sounds exciting, but ranges were not large.
The yuan was active though. The PBOC took an axe to the CNY again today, with USD/CNY to its highest in 7 months at the reference rate setting. USD/CNH surged alongside. There was then both jawboning and intervention (see bullets above) in the yuan for the central bank, and a subsequent small gain for the Chinese currency both on and offshore. It remains looking on the heavy side though.
Data flow today ... Business confidence fell in the NZIER Q2 QSBO survey. The drops in confidence in NZ are a bit of a worry, so much so it prompted the finance minister to make a few statements in support. On the plus side in the survey employment intentions held up relatively well.
We also got May building approvals from Australia, which missed on both m/m and y/y. The falls seem were driven largely by a large 9% fall in private detached dwellings. The fall looks overdone, but hey, the trend is firmly down and investment activity is also slowing - further weighing.
Still to come, RBA due at 0430GMT
- This has links to all the previews: RBA announcement due soon - levels to watch in the AUD
And:
