Forex news for Asia trading Wednesday 3 June 2020
- Australian Treasurer Frydenberg says measures on coronavirus have hit the economy hard
- Australian building approvals data earlier a massive upside surprise
- China Caixin services PMI for May 55.0 (April was 44.4)
- Australia Q1 GDP -0.3% q/q (vs. expected at -0.4%)
- Australia Building Approvals for April: -1.8% m/m (expected -10.7%)
- PBOC sets USD/ CNY reference rate for today at 7.1074 (vs. yesterday at 7.1167)
- FX option expiries for Wednesday June 03 at the 10am NY cut
- Oil building on its gains in Asia time zone trade
- Japan - Jibun Bank/Markit Services and Composite PMI (final) for May: 26.5 (prior 21.5)
- Here are 5 positives for the AUD, but there are negatives
- Japan press say the BOJ is considering expanding its small business lending program
- UBS - Current strength of the Australian dollar is driven by the wrong reasons
- President Trump dialling back on his threat to impose martial law against protestors
- Nissan says its UK manufacturing is "unsustainable" if there is no Brexit trade deal
- Australia May Services PMI 26.9, Composite 28.1
- Australia AiG Construction PMI for May 24.9 (prior 21.6)
- Brexit trade talks update - EU is prepared for an extension up to 2 years
- The German government coalition discussion on further stimulus will continue tomorrow
- UK PM Johnson says he might offer 3m HK residents a route to UK citizenship
- Trade ideas thread - Wednesday 3 June 2020
- Private oil survey data shows draw in crude oil inventory
- ICYMI - China warns of swift retaliation against the US
There was USD weakness pretty much across the major FX board here during the Asia session, with the Australian dollar a star performer. Big AUD/JPY buying was seen out of Japan early in the piece, driving the cross over 75.70 briefly and AUD/USD above 0.6980 for huge gains. There has been some pullback as I update. EUR, GBP, NZD, CAD all followed a similar path, higher then some pullback.
News flow was light but we did have some data. Of minor note were the PMIs from Australia, both awful, and similar from Japan.
The China services PMI jumped more than 10 points.
Of more focus from Australia today were the building approvals data for April, not as bad as expected, and the Q1 GDP report, similarly not as bad as expected. Building approvals are expected to languish in the months ahead though. And as for GDP, while the Q1 was not as bad as projected Q2 will be much, much worse than Q1, it will capture a more prolonged period of lock down for the country and across the economy.
But ... as you can see from the opening lines to this post none of it mattered to the Australian dollar. Huge move for it here today (and others too). The Australian dollar has been strong for weeks now and those following along with the 'trend is your friend' advice (for this and other 'risk' assets) will be seeing its value.
Oil, too, higher for the session. Early inventory data gave it a pop and it never looked back.
