Forex news for Asia trading Wednesday the 6th of May 2020
- TD say EUR/USD to drop further in coming weeks - here's why
- Oil - some notes on the improvement in sentiment
- NZ PM Ardern says New Zealand economy has a safe haven advantage
- Australia March retail sales boosted by pre-lock down buying: +8.5% m/m
- Forex options expiring at the 10am NY time cut Wednesday 6 May 2020
- PBOC sets USD/ CNY mid-point today at 7.0690
- New Zealand trade data update - provisional data shows exports up y/y
- Hong Kong April PMI still deep in contraction, to 36.9 from 34.9 prior
- JP Morgan on rising forex algorithm use
- The US has extended the deadline for the return of PPP loans
- New Zealand Q1 Unemployment rate 4.2% (expected 4.4%) & Employment change 0.7% q/q (expected -0.2%)
- US-China trade war. War of words heating up - a reminder of where tariffs are
- RBNZ forecasts a huge drop in GDP, wide range of outcomes possible
- Trump to disband the US coronavirus taskforce but make up a new one
- Australian Treasurer Frydenberg says unemployment to get worse before it gets better
- Trade ideas thread - Wednesday 6 May 2020
- Private oil survey data shows a larger than expected build in headline crude oil inventory
Early events prior to the Tokyo open time (Japan was still on holidays though, just using this time as a reference point) moved the NZD. Firstly the RBNZ published a paper cautioning the economic impact of the COVID-19 response would be severe but of, as yet, unknown magnitude. This dropped the NZD a few points. A little later, on approach to the release of the New Zealand employment report for Q1 there was an early leak of the data which saw the kiwi $ gain back its earlier loss. The data that was leaked turned out to incorrect but it was in the right direction, showing a better than expected labour market performance in Q1. I noted prior to the data release that the Q1 data was of only limited value given NZ went into lockdown on March 26, only 4 days before the end of the quarter. Nevertheless the data did give us a picture of a slightly stronger jobs market in NZ heading into the crisis.
USD/JPY broke its lows from last week prompting a small drop and dragging yen crosses a little lower.
News flow for the session was non-impactful. On the data agenda we had Australian retail sales for March, which jumped on a surge in spending heading into the lockdown. Q1 retail sales were underwhelming.
Oil moved higher only to drop back from its high. Private survey inventory data released at the end of the US (east coast) day showed a slowing in stock build. Official US government data is due on Wednesday morning (US time) which will be watched to see if the inventory build slowing is confirmed, but also gasoline inventories for signs of increased demand.
EUR, GBP, CHF are all little changed against the USD. Gold is net little changed also despite a drip lower then a jump retrace.
China reopened after a holiday on Monday & Tuesday. The People's Bank of China set the reference rate for CNY slightly higher than was expected. Offshore yuan had been sent lower over the holiday in the wake of rising tensions with the US (Trump administration vocal in blaming China for the global virus outbreak) - the steadier CNY setting was a bit of a counter to this.
Japanese markets were closed again today - resume tomorrow.
