Forex news for Asia trading Wednesday 29 July 2020
- Here's a forecast for gold to ... $2,300 / oz
- USD/JPY seen to as low as 102 in 1 to 2 months
- Australian inflation data - Q2 CPI, headline -1.9% q/q (expected -2.0%)
- PBOC sets USD/ CNY reference rate for today at 6.9969 (vs. yesterday at 6.9895)
- FX option expiries for Wednesday July 29 at the 10am NY cut
- Further coronavirus restriction in Australia - tighter border closure
- Fitch on Japan: Affirms rating at 'A' , but lowers its outlook to negative
- FOMC announcement due Wednesday 29 July 2020
- Japan press say the government will forecast a 4.5% GDP contraction for FY2020/21
- Russia expected to approve a coronavirus vaccine within 2 weeks - 'Sputnik moment'
- ICYMI - Reports that HK is set to announce deferment of election scheduled for Sept 6
- China's latest new cases number of COVID-19 are the highest since March
- Air New Zealand freezes bookings to Australia until late August
- Australian Foreign Minister Marise Payne says has no intention of hurting relationship with China
- Gold around $2,000 - this may be the “new normal”
- Further near term declines seen forecast for the US dollar
- UK data - BRC Shop Price Index -1.3% y/y for July (vs. prior -1.6%)
- US House Speaker Pelosi says Republican coronavirus stimulus bill unlikely to pass in Senate
- Goldman Sachs 12 month forecast for gold is US $2300 / oz (from previous $2000)
- Meadows says Democrats unwilling to accept gutting the unemployed
- Hong Kong have further tightened coronavirus restrictions says China's Global Times
- Mnuchin on the coronavirus economic relief negotiations: “Just the beginning of the talks”
- Goldman Sachs says real concerns about USD as reserve currency. Barclays says No.
- Trump press conference - talking up vaccine hopes again
- Pelosi says she does not believe McConnell is ready to make an agreement on coronavirus aid
- ICYMI: JP Morgan expect gold rally to lose momentum in the months ahead
- Trade ideas thread Wednesday 29 July 2020
- Private oil survey data shows a large draw in crude oil inventory
Late afternoon and into evening US time saw a steady trickle of coronavirus recovery stimulus-bill related news from the negotiating parties. It does appear that Senate Republicans cannot reach agreement amongst themselves, let alone with the other side of politics. Talks have been described as still in the early stages.
Other news flow was light and of little impact. China recorded its highest one day total of new coronavirus cases for around 3 months, while Australian hotspot of Victoria saw its new case count drop under 300 for the first time in about a week; lockdown measures seem finally to be taking effect on this metric. Australian state of Queensland is to reseal its border with Australia's largest population state of New South Wales over the continuing outbreak there, another set back for economic recovery in Australia. News crossed again of a Russian-developed coronavirus vaccine, said to be ready for approval in about 2 weeks. We'll see.
For data, the focus was Australia's Q2 CPI, the headline came in at -1.9% for the quarter while the RBA preferred measure, trimmed mean, was also negative, -0.1% on the quarter, taking y/y to 1.1%. The RBA target band is 2 to 3%. The data release was followed by a small drop in AUD/USD and NZD/USD. But, as mentioned already FX ranges were subdued.
Gold tracked a roughly $1950 to $1964 range, not too far from yesterday's highs.
