Forex news for Asia trading Thursday 19 November 2015

  • Morgan Stanley Sees Euro Falling to Dollar Parity
  • Yen continues to strengthen a little following BOJ's on hold decision
  • AMP Capital's 5 reasons not to be too worried about the Fed
  • Bank of Japan monetary policy announcement: NO CHANGE
  • Australia blocks sale of cow farm to overseas buyer
  • UBS says offshore interest in the Aussie dollar has picked up again
  • BoA/ML say the USD decline since the FOMC Minutes reflects positioning
  • The 3 PBOC officials who have been given corruption warnings
  • Forex. The not rocket science post.
  • MNI China November Business Indicator: 49.9 (prior 55.6 )
  • NZD & AUD to fall on severe drought? The El Niño impact.
  • People’s Bank of China (PBOC) sets yuan reference rate at 6.3791
  • PIMCO: "The FOMC has essentially locked itself into a December hike"
  • Cable on the move ... watch out above?
  • Japan Trade balance for October: Y 111.5bn (expected Y -246.3bn)
  • China: Ex-SAFE official says should adopt a strong yuan policy
  • NYSE to eliminate stop loss orders
  • NZ PPIs for Q3: PPI Input +1.6% q/q (prior was -0.3%) Output +1.3% q/q (prior -0.2%)
  • New Zealand Oct ANZ job advertisements 1.2% m/m vs +2.1% prior

USD weakness following the publication of the October FOMC meeting Minutes carried on in Asia today. Currencies were broadly higher against the USD, with positioning cited as a key driver (i.e. stop losses on long US dollar positions).

On the economic data front, PPI measures from NZ came in much stronger than prior results with the lower NZD cited as a key reason (higher price for imported products). The NZD has gained on the session, but disentangling the effect from the broad unwind of USD positions is difficult.A little weakness over the course of the session in AUD/NZD helped to highlight some NZD outperformance.

The Japanese October trade balance came in with a headline surplus, but the details were very poor, with exports still underperforming but a collapse in imports (which drove the surplus) ... lower imports are indicative of a Japanese economy that is still struggling.

The Bank of Japan policy meeting concluded today with no change from the bank. The statement did note that some inflation expectations were showing some signs of 'weak developments'. Nevertheless, the board was not swayed, 8 of them wanting to keeping policy unchanged while the usual dissenter proposed scaling QQE back!

The yen found some strength against the USD in the wake of the announcement (it had been a laggard against the USD in the lead up).

Commodities were down again in China ... Dalian iron ore, for example, down more than 2% to a record low.

Regional equities with Shanghai closed for the lunch break:

  • Shanghai -0.05%
  • Nikkei had a great morning, but pared gains a little after the BOJ announcement and subsequent yen strengthening +1.05%
  • HK +1.15%
  • ASX +1.51%

Gold made some gains on the session, oil up a little also.