Forex and Bitcoin news for Asia trading Friday 13 April 2018

The Hong Kong Monetary Authority (HKMA) confirmed intervention n the HK dollar market. The central bank bought HKD (sold USD) after the local dollar fell the lowest permitted in its trading band.

  • Bought 816 million HKD purchase on Thursday
  • Bought another 2.44 billion HKD early on Friday morning

While the HKMA is obliged to do something to maintain the HKD in its band (and have the reserves to do more if needed) its going to be an uphill battle for them. While the USD remains weak and the spread between LIBOR and HIBOR persists the market is incentivised to borrow HKD as funding for higher yielding assets that are expected to be stable and /or appreciate (for example, the yuan, both onshore and offshore, has been on an uptrend). This will keep the HKD under pressure.

Meanwhile, in Singapore, the central bank there (the Monetary Authority of Singapore (MAS)) tightened monetary policy (check out how, here:

The SGD gained on the announcement, chart from the post at the time:

On trade issues, we got the March trade balance from China today, the first deficit (USD terms trade balance) since February of 2017:

We also got TPP comments out of Japan

And out of President Trump:

In other news, we go the odd bit on Syria, but noting really new (see bullets above).

From Australia today we had the twice-a-year RBA stability review.there is a (longish) post on it above, but long story short: the Bank continues taking note of risks around

  • low rates around the planet
  • China
  • local housing (but having diminished) & commercial property
  • Household debt
  • Roll over of interest only debt in coming years may see increase in repayments and weight on economy

See positives on:

  • banks improving
  • And while rise in short term funding costs is an issue, not overly concerned

Currencies did not swing in big ranges. USD/JPY popped it ovenight high but did not sustain there as is little net changed on the session (up a few tics overall).

AUD/USD traded higher (AUD/JPY too) within a small range though.

CAD, NZD, EUR, GBP, CHF all little changed against the USD. Gold gained a few dollars

Bank notes:

Still to come:

And so I'll hand over to the Europe/UK time zone. And of course, no Mike today :-(

I'm gonna miss him! Mike was a stalwart of the UK/Europe time zone and did a huge service with his comprehensive posting on levels and orders each and every day... along with other posts of course. And, if you haven't already, check out his brilliant: ForexLive Education: Option contracts, their impact and how to trade off them