Forex news for Asia trading - Wednesday 15 July 2020
- Goldman Sachs 12 month forecast for the yuan is to 6.70
- EUR/USD heading to a formidable barrier at 1.1495
- Japan Eco Min Nishimura says current amount of coronavirus infections not large
- Tokyo governor has brought forward meeting over coronavirus response
- China is to set sanctions on the US over Hong Kong
- PBOC 400 billion yuan 1-year MLF at 2.95%, rate unchanged
- PBOC sets USD/ CNY reference rate for today at 6.9982 (vs. yesterday at 6.9996)
- FX option expiries for Wednesday July 15 at the 10am NY cut
- Australian state of Victoria new coronavirus cases rise by 238
- Goldman Sachs forecasting solid returns for US share markets - point to their success at forecasting
- California new coronavirus cases rise at a new record rate, more than 10K
- Australia Westpac monthly consumer confidence indicator -6.1% m/m (prior +6.3%)
- EUR, AUD, NZD, GBP, CAD continue their moves higher into Tokyo morning
- China unconcerned on Trump's revoking Hong Kong's special status
- Reuters tankan report shows July manufacturers' sentiment index -44 (vs June -46)
- Coming up soon! BOJ monetary policy statement announced on Wednesday 15 July
- Japan press reports Tokyo to raise COVID-19 alert to the highest level
- NZ PM Ardern rules out NZ - Australia travel opening for now
- Trump says he has no plans to speak to China's President Xi - Trump says more action to come against China
- Los Angeles Country hits a record high for new coronavirus cases today
- Coronavirus - NZ PM Ardern warns of potential for further NZ lock downs
- Trump has signed the China sanctions bill
- US coronavirus - Texas hits another record high for new cases
- UK press reports masks could be compulsory in all public spaces (eg. workplaces)
- Moderna says its coronavirus vaccine trial produced ‘robust’ immune response in all patients
- ECB meet this week (preview) but they are already driving the higher euro
- Trade ideas thread - Wednesday 15 July 2020
- Private oil survey data shows a large draw in crude oil inventory
- Fed's Harker: Cannot fully reopen the economy until the virus is under control
- Dallas Fed Kaplan says seeing pronounced slowing in economy again
- Trump says he is not interested in speaking with China on another trade deal
- Fed's Bullard: No need for forward guidance, other monetary policy
A report out of the US after the local stock market close on Moderna's potential vaccine to prevent Covid-19 giving promising results (in all 45 patients in an early stage human trial) was enough to support risk trades across currencies and equities (China equities excluded, I'll come back to that).
The vaccine was reported to have produced a "robust" immune response in all patients the early stage human trial, according to data published in the New England Journal of Medicine (note this is a reputable, peer-reviewed journal).
The USD saw losses almost across the board; AUD, EUR, NZD, CAD, GBP all higher, but with some retrace since. S&P futures also higher in Globex trade.
Other news on the session was again out of the US with Trump signing a bill, and also an executive order, sanctioning China for its moves on Hong Kong. Later, into the morning in China, China responded by saying it would in turn sanction US officials and entites in response. The tit-for-tat developments weighed on Chinese equities. As I post the Shanghai Composite has given back its earlier gains and traded lower.
The PBOC injected one-year liquidity today, partially offset by maturities. We await the Bank of Japan policy announcement.
