Forex news for Asia trading Thursday 11 August 2016

The Reserve Bank of New Zealand delivered the much telegraphed rate cut today, a 25bp cut and a promise of more to come, especially if the NZD rises (so we should get another one tomorrow, right? - joke). As soon as the cut was announced the NZD/USD jumped more than a cent; the market well positioned for a cut after RBNZ communication in past weeks and the immediate reaction was a short cover.

Links as the decision, press conference and more unfolded (read from bottom up):

Since the initial reaction market movement has been more subdued, NZD/USD trading in a circa 0.7270/0.7300 range (give or take a few points). We haven't had much of a retrace/gap fill and the potential is there but may be contingent on how the USD behaves in Europe/UK time.

AUD/USD spiked higher with the NZD but settled back near where it was prior to the RBNZ announcement. As I write its testing towards the subsequent range low under 0.7700.

A Tokyo holiday today (markets closed) seemed to keep other major FX quite subdued. Late NY time saw a sudden dip in the USD/JPY to around 101 , but since then its been 101.05/101.35 (and is at the high end of the that range as I update ... and through 101.40 as I proofread the post).

EUR/USD ticked back toward its overnight high, but from 1.1190 its drifted off again to be near 1.1170 as I post. USD/CHF was subdued also.

Cable is little changed on the session after a 20 off point range.

Gold lost a few dollars, on session lows as of now under $1343.

The PBOC set the USD/CNY lower today; on the 1 year anniversary of the big yuan devaluation there was extra attention on today's 'fix'.

Regional equities:

  • Nikkei - Japan holiday
  • Shanghai +0.09%
  • HK +0.18%
  • ASX -0.91%