Forex news for Asia trading Thursday 10 November 2016

  • NZD/USD to new session low
  • More from Fed's Williams: Argument for gradual US rate increase still makes sense
  • China Com Min: External trade outlook is not optimistic, many uncertainties
  • Fed's Williams: Fed can start gradually removing easy policy over next few years
  • Here comes Mr. Yen! USD/JPY at 100 'not a problem for Japan'
  • Trump not seeking Yellen’s resignation, economic adviser says
  • Japan's Aso: Governments don't intervene in FX except in exceptional cases
  • People’s Bank of China sets yuan reference rate at 6.7885 (vs. yesterday at 6.7832)
  • Australia data - September Home loans +1.6% m/m (expected -1.6%)
  • In swamp-draining news: President Trump to appoint Goldman Sachs veteran as Treasury Secretary
  • RBNZ's Wheeler: People trying to work out what Trump win means for fiscal policy
  • UK data - RICS House Price Balance for October at +23 (expected +19)
  • United States of America affirmed by S&P, outlook stable
  • ANZ on USD/JPY "we have lifted our 2017 forecast to 115"
  • Bank of Japan 'Summary of Opinions' from the October 31 - November 1 meeting
  • Japan data: Machine Orders for September: -3.3% m/m (expected -1.5%, prior -2.2%)
  • BoA revise its US economic outlook for 2017 lower
  • Goldman Sachs consider London to Frankfurt shift to secure EU market access
  • Next on the global macro risk agenda ... bring on the Italian constitution vote
  • South Korea's Finance Minister needs to turn on his Bloomberg
  • Overnight metals - copper to a 15-month high
  • Heads up for Trump's date in court - Nov 28 fraud case
  • Trade ideas thread - Thursday 10 November 2016
  • RBNZ's Wheeler trots out an NZD intervention threat, sends it down a bit
  • Reuters poll shows around 85% surveyed expect Federal Reserve hike in December
  • RBNZ's Wheeler: Considered cash rate decision in light of US election results
  • PIMCO's Mather - Says less chance of a December rate hike from Fed now

USD/JPY traded higher initially, toward (but not reaching) 106 before it started to slip and continued down to (briefly) under 105. There was data and news but the moves were more related to flow adjustments following Tuesday's wild moves. On the data front, we did get core machinery orders (September). This is a proxy for capital expenditure in coming months, and it showed down again (m/m) in the figures today (August was lower also), while the y/y chopped much lower from the August result, though it was a beat on expectations.

Following the late US time (early NZ) announcement of an RBNZ rate cut, the Bank signalled at its Governor's press conference (and later parliamentary appearance) quite clearly that a pause is now on the cards for perhaps an extended period of time. Wheeler also warned at his presser that he had an open mind about intervening in the NZ dollar. NZD had jumped earlier on the (almost universally) expected rate cut and subsequently gave it all back during and following the presser.

AUD/USD traded like the tail to the NZD dog today, following along in a similar, though reduced range, pattern the NZD/USD trade. AUD/USD did outperform as the session wound on, though not by much. Its is near session highs as I update while the NZD is making a new session low.

EUR and CHF both rounded slightly stronger against the USD after their huge Tuesday moves. GBP chopped in a range and is little changed since the NY finish.

The People's Bank of China welcomed Donald Trump as President-elect by setting the yuan's reference rate against the USD at its lowest in 6 years today. Trump has repeatedly referred to China as a currency manipulator and has promised to impose high tariffs on Chinese imports. China's response today is obviously 'Bring it'. Should be fun.

Gold recovered some of its US time zone slide, back towards $1290.

Regional equities (Green Day edition):

  • Nikkei +6.04%
  • Shanghai +1.14%
  • HK +1.85%
  • ASX +2.95%