Forex and Bitcoin news for Asia trading Wednesday 16 August 2018
China / US trade talks announced (read from the bottom up)
- More still on US / China trade talks coming up in late August
- More on China delegation to visit US for trade talks
- China's vice commerce minister to visit US for trade talks
Other:
- BOJ said to be setting the stage for a rate hike before hitting its 2% inflation target
- IMF says it has not received any indication Turkey will ask it for assistance
- Australia July Employment change -3.9K (vs. +15K expected)
- PBOC sets USD/ CNY reference rate for today at 6.8946 (vs. yesterday at 6.8856)
- <a title="Australia data: Consumer inflation expectations for August: 4.0% (prior 3.9%)
- WSJ reports on Trump interview - tariffs are rescuing U.S. industry
- Japan trade balance for July: Y -231.2bn (expected deficit of Y 41.2bn)
- Euro at parity … risk of U.S. dollar intervention … yowza ... Check out this quick video!
- Fed has refrained from raising rates due to EM fragility in the past, but won't this time
- Here are the 5 sticking points that will keep China and the US at a trade war
- Deutsche Bank traders made $35 million on Turkey moves in just 2 weeks
- FX currency intervention watch - more
- Trade ideas thread - Thursday 16 August 2018
The news of the day is that a delegation from China led by China's Vice Commerce Minister Wang Shouwen is to head to the U.S. for trade talks in late August. Meeting with an American group led by David Malpass, under secretary of the Department of the Treasury.
Forex reaction was a pop for EUR/USD (along with AUD, NZD, GBP, CAD) and also for USD/JPY (ie a move by traders out of yen). The response was not huge, there were some stops to be triggered and that has seemed like it so far. You'll recall a similar high-level meeting in May; the agreement from it was scuppered by the US President pretty much straight after, and the trade war escalated in June and since. It is perhaps (no perhaps about it) this memory which limited the positive vibe from the headline.
Anyway, dialogue is a good sign so I think it is reasonable to expect some follow through as Europe comes in and responds. Are we out of the trade war woods yet? IMO no, but at least its something.
Equities responded with a cautious bid also.
Prior to this forex was subdued. USD/JPY had slipped a few points, as had yen crosses (EUR, AUD etc all a bit softer against the USD).
On the Australian dollar we got some data, the jobs report for July. The headline employment change was a bad miss, but otherwise details were more positive and the prior showed encouraging revisions.
The People's Bank of China set the reference rate for the onshore yuan weaker again today (ie higher USD/CNY), but with news of the trade talks the yuan has since gained a little.
Still to come:
