Forex news for Asia trading Tuesday 1 December 2015

Intro Paragraph Text Here.

  • RBA November and December Statements - play 'Spot the Difference'!
  • RBA announces no policy change, as expected (+ Governor Stevens comments)
  • PBOC's Yi: Don't worry about yuan depreciation
  • PBOC official says will develop a stable interest rate corridor
  • USD weakness spreads
  • Strong Australian data earlier - expectations for Q3 GDP being revised higher
  • Japan econmin Amari: Companies starting to implement planned capex spending
  • China Caixin Manufacturing PMI (Nov): 48.6 (expected 48.3)
  • Japan Nikkei Manufacturing PMI for November: 52.6 (flash 52.8)
  • AUD and NZD gaining
  • PBOC sets yuan reference rate for today at 6.3973
  • China official November Manufacturing PMI: 49.6 (expected 49.8)
  • China Non-Manufacturing PMI for November, 53.6 (prior was 53.1) - early release
  • Building approvals for October: +3.9% (expected -2.5%)
  • Australia: BoP current account and exports data for Q3
  • FX technical analysis: Set ups in EUR/USD, USD/JPY, GBP/USD, USD/CHF, USD/CAD
  • Morgan Stanley says USD/JPY is going to 115
  • Japan data: Q3 Capital Spending: 11.2% y/y (expected 2.2%)
  • NZD traders - Dairy auction coming up today
  • New Zealand - QV House Prices for November: +15% (prior +14.0%)
  • Australia - CoreLogic RP house price data for November: -1.5% (prior +0.2%)
  • Australia data: AIG Manufacturing PMI for November: 52.5(prior 50.2)
  • ANZ Roy Morgan weekly Consumer Sentiment: 112.8 (prior 114.5)
  • Preview of the RBA monetary policy decision today and accompanying statement
  • NZ data - Terms of Trade index for Q3: -3.7% q/q (expected -2.6%)
  • CFTC Commitment of traders report: EUR shorts increase by 11K
  • Trade ideas thread for Tuesday 1 December 2015

Someone left a banana peel on the ground today and the USD went and trod on it, slipping lower through the session.

AUD and NZD started it all off, carrying on their dual overnight strengthenings with nary a backward glance. NZ Q3 terms of trade came in at a miss. Did the NZD care? Hardly.

AUD weekly consumer sentiment data fell a little; this is not a high importance data point for the market, rarely causing much in the way of rates response. Manufacturing PMI is also rarely a market mover, but it notably came in for its 5th consecutive 'expansion' reading, something it hasn't managed since 2010. House price data that followed showed a moderation in the pace of gains (a fall on the month and a gain still on the y/y), while NZ stuck its tongue out at Australia, its house price data showing gains at a faster pace.

It was building approvals and Q3 current account/exports data that lit a (little) fire under the AUD (and helped NZD along too). The exports data is an input to the GDP tomorrow and the strong performance has seen expectations for Q3 GDP revised broadly higher (not all have done so, it should be said ... but I have). AUD pushed above stops around 0.7250 while NZD did the same above 0.6600.

Meanwhile, we got promising capex data out of Japan, again a surprise and a big one (+11.2% y/y against +2.2% expected). The yen found its feet after that.

China manufacturing PMIs today ... both official and private ... disappointing (both still in contraction, albeit the Caixin survey in above expected). The official services PMI improved.

CHF, GBP, JPY and EUR all gained against the USD as the Asian morning progressed, to varying extents. The CHF was a bit of a laggard while the yen was ahead of the pack. GBP and EUR put on a good few points (for an Asian session, that is). EUR/JPY fell away on news the GPID was heding some EUR exposure (selling EUR).

The afternoon brought the RBA policy announcement and accompanying statement. As expected policy remained on hold, while there was only a little change to the statement from Governor Stevens. AUD/USD dropped 15 or so points on the immediate announcement but soon retraced it all and is stable as I update.

Gold gained, oil up a few cents, not a lot in it.

Regional equities with Shanghai closed for the lunch break:

  • Shanghai -0.45%
  • Nikkei +0.95%
  • HK +1.65%
  • ASX +1.90%

Still to come:

  • NZD traders - Dairy auction coming up today