Forex news for Asia trading for Wednesday 11 November 2020

The New Zealand dollar was a mover again during the session, with Reserve Bank of New Zealand Assistant Governor Hawkesby giving a media interview reiterating some of the points the RBNZ and Governor Orr made yesterday. Hawkesby said

  • the Bank is not ruling out negative rates but less stimulus appears to be required than was thought necessary just a few months ago
  • RBNZ has not changed its guidance on keeping OCR at 0.25% until March 2021

There is more in the relevant bullets above.

A point Hawkesby made was that the move higher for the kiwi $ came because analysts changed their call on expecting negative rates (if you recall from yesterday, markets repriced their view on negative rates from the RBNZ as now being a lot less likely). What maybe he should have added is that analysts were quite right to do so as the RBNZ made clear yesterday, its (I posted this yesterday) "unconstrained OCR track" indicated the Bank now views that around 100bp less stimulus is necessary ... so of course the market repriced the probability of negative rates!

NZD/USD traded to a high of 0.6915 and thereabouts before dropping back under the figureeand is circa 0.6890 as I post.

USD/JPY lost some ground today, 20 or so points. Other currencies are little net changed.

Coronavirus news was mixed, with Moderna making positive sounds on the progress of its vaccine candidate (initial availability appears it may be close to around the same time as Pfizer's - that's my take, not a quote from Moderna) while US new cases rocketed to close to 144,000 for the most recent day, and a number of hospitals are reporting they are at capacity. The US election news was a groundhog day, Biden leading and the margin is increasing, Trump still not recognising the result.

Note in the bullets above, heads of the BoE, ECB and Fed are all speaking today!

Forex news for Asia tradingfor Wednesday 11 November 2020