Forex news for Asia trading Friday 21 February 2020
Coronavirus related:
- All foreigners in North Korea are quarantined until March 1
- China Beige Book says its data for Q4 show late payables & deliverables at "worst levels we've recorded"
- China cars sales down 92% in first half of February
- Japan's Jiii reports Japan will postpone or cancel indoor events for 3 weeks
- China Commerce Ministry says expects foreign firms in most places in China will resume production by end-February
- China says the coronavirus vaccine to be submitted for clinical trials around late April
- China says accelerating plans for further measures to support firms, economy
- South Korean airlines to suspend more flights over coronavirus
- South Korea - first coronavirus infections in the armed forces confirmed
- Coronavirus - US CDC has issued a Phase 1 travel advisory to travellers to Japan
- Coronavirus has halted most China-Europe freight trains
- Mainland China official coronavirus deaths increase by 118, cases up 889 as of end February 20
- South Korea confirms 52 new coronavirus cases, take total to 156
- Australia - 2 people evacuated to Darwin from the Diamond Princess cruise ship have coronavirus
- Coronavirus - South Korea has declared Daegu and Cheongdo "special zones"
- China's Hubei province coronavirus infection update: 411 new cases on Feb 20, 115 new deaths
- Coronavirus outbreak to affect Japan's annual shunto wage negotiations.
Other:
- ANZ note AUD/USD is 4 cents under fair value model
- BOJ's Kuroda: BOJ will examine ways to end ETF buying when inflation approaches its target
- Japan CPI data from earlier - strip out the sales tax and core was 0.4% only
- Japan finance minister Aso says FX stability is important
- PIMCO like the yen and GBP, see moderate USD fall
- PBOC sets USD/ CNY reference rate for today at 7.0210 (vs. yesterday at 7.0026)
- FX option expiries for Friday February 21 at the 10am NY cut
- Japan January inflation data still way below target - recap
- Japan eco min Nishimura: Think weak yen is a reflection of a strong US economy
- RBNZ Gov Orr says in no hurry to go lower with cash rate
- BOJ Gov Kuroda says there is a high chance the coronavirus impacts the global economy
- Japan preliminary PMIs February: Manufacturing 47.6 (prior 58.8) & Services 46.7 (prior 51.0)
- Japan finance minister Aso says he will not comment on forex levels
- Japan CPI data for January, headline inflation 0.7% y/y (expected 0.7%)
- Here is another response to the Australian flash PMIs - Q1 GDP to probably contract
- RBNZ Gov Orr says record low international interest rates a new challenge facing the Bank
- Germany says trade outlook remains weak
- FOMC may cut in March, but only if the coronavirus situation accelerates dramatically and the sky is falling
- Response to the lower Australian PMIs (flash) for February
- Australia February preliminary PMIs: Manufacturing 49.8 (prior 49.6) Services 48.4 (prior 50.6)
- Trade ideas thread - Friday 21 February 2020
Once again coronavirus news dominated the session, but currency response was limited. Cases in China continue to grow but cases in South Korea are now being reported at a rapid rate. Two cities have been placed into 'lockdown' (that's my take, the Korean government has declared them special zones) and cases have been reported inside three branches of the military. Add in a couple of new cases in Australia (two passengers from the Diamond Princess cruise ship flown into Darwin tested positive).
If there is anything positive that might be able to be taken away from the outbreak in South Korea its that we get better information on the spread of the infection than we have been getting out of China, where official figures have been questioned repeatedly. Its not much, but better information will help fight the outbreak.
AUD/USD dipped under 0.6600 on the session, its lowest since 2009. NZD/USD fell also.
OK, what else? The item of most interest on the data calendar was Japanese inflation, national CPI for January. It goes without saying that the three measures are all way below target, well under 1% (the BOJ target is 2 if you need reminding) . And, if the impact of the sales tax is stripped out (as it should be) they are around (under) 0.5% and change. USD/JPY has not had much movement here during the Asian session. Fin Min Aso had a few comments on the past two days volatility (see bullets above).
