ForexLive Asia FX news wrap: AUD and NZD both drop
Forex news for Asia trading Friday 14 June 2019
- France's fin min Le Maire says EU ministers have agreed the Eurozone budget
- A couple of other rate cuts calls from Australia - RBA seen at 0.5% by two banks
- Largest Australian fund manager says more downside to come for AUD … but …
- AUD traders note - NAB forecasts RBA to cut cash rate to 0.75% in November
- ICYMI - Morgan Stanley Business Conditions Index, June, records its biggest drop on record
- US has released video it says shows Iran removing mine from side of Japanese oil tanker
- PBOC sets USD/ CNY mid-point today at 6.8937 (vs. yesterday at 6.8934)
- US officials say they have imagery showing Iranian boat removing unexploded mine from Gulf tanker
- Walmart, Target, more than 600 other companies urge Trump to resolve trade dispute with China
- Japan economy minister Motegi says met with US Trade Rep Lighthizer
- New Zealand Food Price Index (May) +0.7% m/m (prior -0.1%)
- New Zealand Manufacturing PMI (May): 50.2 (prior 53.0)
- Visa, Mastercard, PayPal and Uber all backing Facebook’s new cryptocurrency
- For NZD traders - next week's big events a risk for higher
- Here's another reason the RBA sees to ease rates - inflation expectations
- More from Gundlach - Gold doing well, the Fed is manipulating US Treasuries
- Trade ideas thread - Friday 14 June 2019
- Fund manager Jeffrey Gundlach says US recession chance is 40-50% in 6 mths, 65% in 12
Iron ore futures surged on the Dalian exchange in China, up nearly 4% on the session (as I update) to a fresh five year high. Have I mentioned before that the AUD seems to have thrown off the shackles of any correlation with iron ore? I have?. Good.
The Australian dollar was a loser on the session, as was the kiwi $.
NZD/USD started the slide early, the catalyst being a drop in manufacturing PMI (and poor details on sub-indexes to accompany the drop) for May. From above 0.6570 NZD/USD dropped to 0.6560 and continued to fall through the session to be barely off its lows as I post, circa 0.6530.
Kiwi has had a soft week indeed:
AUD/USD followed along a little later. There were reports of a geopolitical nature. The US said it had, and later released what it said is, video footage of an Iranian boat removing a limpet mine from the side of a Japanese tanker. Alongside this we got news of China imposing duties on pipes (a certain class of) from the US and other countries. But what its most likely turned out to be driving the bus over the AUD today were more aggressive interest rate cut forecasts from Australian banks. The RBA is now seen at:
- 0.75% (ie 2 more cuts) by November this year - NAb forecast
- 0.5% in 2020 - RBC forecast
- 0.5% in 2020 - Macquarie forecast
AUD/USD dropped under 0.6895 and is barely above as I update.
Moves were confined to tight ranges elsewhere, CAD, EUR, CHF a touch lower against the USD. GBP barely changed, as is yen.
Still to come:
- US retail sales data for May due Friday - preview
- FX option expiries Friday 14 June 2019, 10am NY cut