Forex news for Asia trading Tuesday 6 June 2017
- Westpac lowers its Australian Q1 GDP forecast to 0.2% q/q (from 0.4%)
- Japan press reports on labour market tightness - freight cos. consider 4-day weeks
- New Zealand Treasury's Monthly Economic Indicators for May
- Australia - CBA revises GDP forecast to +0.1% q/q
- PBOC conducts 498bn yuan MLF operations
- Australian dollar lower after bad data miss brings negative GDP worry back
- AUD/USD still sliding after the export numbers miss
- HSBC new yuan forecast: USD/CNY at 6.9 by end-2017 (from 7.1 prior forecast)
- Australia - Q1 current account: A$ -3.1bn (expected -0.5bn AUD)
- Australian minimum wage to be raised by AUD22.20/week
- PBOC sets USD/CNY central rate at 6.7934 (vs. yesterday at 6.7935)
- New Zealand - ANZ Commodity Prices for May: +3.2% m/m (prior -0.2% m/m)
- USD/JPY lower, some USD movement elsewhere but yen the outperformer
- ANZ chief executive Shayne Elliott - says Australian house prices 'very inflated'
- Japan finance minister Aso - wants lower debt to GDP ratio for Japan
- Contractor charged with leaking document about US election hacking
- Japan - (April) Labor Cash earnings: +0.5% y/y (expected +0.3%)
- Heads up for NZD traders - Global Dairy Trade auction in London time today
- Australia - Weekly consumer sentiment from ANZ / Roy Morgan: 112.9 (prior 112.2)
- Plenty still to come on the New Zealand data calendar today. And some SIX60 too.
- UK - BRC Sales (like-for-like) for May: -0.4% y/y (expected -0.2% y/y)
- NZ - Value of Building Work Q1 2017: -3.5% q/q (expected +0.3%)
- New Zealand government financial statements, 10-month update out now
- UK election poll - Cons on 41.5%, Labour on 40.4%
- PIMCO on Italian politics: baseline Italy stays in EUR, but Italexit not a "crazy idea"
- Australia - RBA decision day - previews
- Technical levels to eye in the new trading day
- Australia Q1 Current Account due today - preview. First surplus for 40+ years?
- Trade ideas thread - Tuesday 6 June 2017
- ForexLive Americas FX news wrap: Dollar hangs tight, AUD higher ahead of RBA
- Economic data due from Asia today, and its RBA day
- US stocks end the day lower. Bond yields are higher.
An active day in Asia with the yen on the move, stinky Australian data (AUD/JPY hit hard), a weaker US dollar and important US political developments.
Yield on US debt fell again, dragging the USD lower. Combined with this we had documents confirming Russian hacking attempts on the US election; the USD fell away a little, the move against the yen was large, USD/JPY dropping 80-odd points to well under 110.
EUR and CHF were outdone, but they did join in the direction; both currencies gaining against the dollar. Cable, too, traded a little higher.
Ahead of the Reserve Bank of Australia decision today (still to come, due at 0430GMT) we had Q1 current account data. The deficit was its smallest since 1979, but was still a miss on expectations. The 'net exports to GDP', which was closely watched as the result is a direct input into the GDP data (for Q1, due tomorrow Australian time; Wednesday 0130GMT) came in at -0.7% points (against expected of -0.4%), reigniting concerns over a negative outcome for the GDP. Government spending data for the quarter also came in lower; it'll be a positive contributor to GDP, but much smaller than it was in Q4 of 2016.
Some of the latest GDP forecasts:
- JP Morgan forecasts Q1 GDP at +0.1% (cut from a +0.4% forecast), but add there is 'some chance' for a negative result
- Westpac revised its forecast to +0.2% q/q (from +0.4%) & 1.6% y/y
- CBA lowered its forecast to +0.1% q/q (+1.4% y/y)
- Capital Economics revised its down to -0.5% q/q (from +0.3%)
The Australian dollar dropped 30-odd points quickly on the data and we now await the RBA announcement (the unanimous expectation is for an 'on hold' decision, attention will quickly turn to the Statement from Governor Lowe for an assessment of whether the tone has turned a little more dovish in the wake of developments or whether the bank will shake it all off).
NZD/USD traded higher with the weaker USD but also benefited from renewed AUD/NZD buying. Reports from New Zealand today paint a picture of a much stronger economy than across the ditch in Australia.
The People's Bank of China targeted an injection of funds today, with a near 500bn yuan MLF operation (see bullets above).
Gold traded higher against the USD.
Regional equities:
- Nikkei -0.50%
- Shanghai -0.22%
- HK +0.31%
- ASX -1.09%
- India's NSE index hit a record high today
Still to come
- RBA due at 0430GMT (previews above)
- Heads up for NZD traders - Global Dairy Trade auction in London time today
