Forex news for Asia trading Tuesday 26 January 2016

China:

  • WSJ on China: Yuan's fall is just 'Noise' amid deeper China woes
  • Despite comments to the contrary from China, analysts still expect RRR cuts
  • China excess steel plant closures: Loss of >400K jobs may threaten social stability
  • PBOC's Zhang: China will not cut RRR for the time being
  • Moody's says China banks face higher risks, loan delinquencies
  • PBOC sets USD/CNY central rate at 6.5548
  • PBOC injects 360bn yuan through 28-day reverse repos, & 80bn through 7-day
  • Advice from Chinese hedge fund manager (made 6,200% last year) Sell stocks now!
  • China press: Willing to tolerate temporary yuan FX rate fluctuations
  • PBOC moves again to tighten yuan borrowing costs in HK
  • PBOC's latest effort to plug capital outflow holes - keeping foreigners capital in China
  • "Dear John" letter from China president Xi Jingping ... RRR cut ... its over :-(
  • Adviser to Japan PM, Hamada says BOJ easing still needed
  • ESM head says decision on Greek debt to be made after reform review complete
  • NZ PM Key: Growing the New Zealand economy is main priority for 2016
  • NZ data - December Credit Card Spending: 7.4% y/y (prior 8.5%)
  • Japan's Amari: Government should not comment on BOJ monetary policy
  • Japan press reports Ex-BOJ deputy gov. sees chance for easing this week
  • Japan data - December Services PPI +0.4% y/y (prior 0.2%)
  • Japan press: BOJ considering using its own CPI index as additional indicator
  • The three factors that will prompt an FOMC rethink
  • Trade ideas thread for Tuesday 26 January 2016
  • NZ data - Services PMI for December: 58.9 (prior 59.8)

'Risk' ended on a sour note at the end of US trading hours, slipping away heavily (like stepping on a thousand banana peels). AUD, NZD, USD/JPY all down, down. (Australian markets were closed for a national holiday.) EUR/USD did its risk off rally boogie.

The moves continued into early Asia, 'risk' currencies lower, USD/JPY lower, while EUR/USD only managed a sideways move.

Bounces came though, AUD and NZD rallied well off their lows, adding 30+ points each. USD/JPY up a little from its lows too. As I update, though, its back near session lows. Oil prices continue to drive, they are also plumbing session lows as I update.

There was very little in the way of fresh data or news today.

On regional stock markets the mood was grim yet again, opening lower after the Wall Street losses. Oil prices slipped lower from their late US levels also.

Gold was a beneficiary, ticking stronger, up above $1112.

The PBOC set the mid point for the USD/CNY lower again today, not by much of course, just a marginally stronger yuan yet again. There was another huge injection of funds into money markets today, further arguing against any near term RRR cut.

Regional equities with Shanghai closed for the lunch break:

  • Nikkei -2.29%
  • Shanghai -2.35%
  • HK -1.86%
  • ASX closed for a holiday today