Forex news for Asia trading Tuesday 5 February 2019
RBA:
- There is more to come from the RBA (thankfully not until tomorrow, then Friday)
- AUD jumped on the as expected RBA decision (so, was it?)
- Comparing the RBA Gov. Lowe's statement in February with his previous
- RBA announce no change to cash rate, on hold as expected
- Preview of the Bank of England Super Thursday! (coming up on, well, Thursday)
- UK data - here are some better numbers to report - consumers spending up
- Response to the weak Australian retail sales results
- NZ data (earlier): ANZ commodity price index +2.1% m/m, its first rise in 8 months
- Fed says Powell and Clarida had dinner with Trump and Mnuchin Monday night
- Bloomberg on: Stronger yen may be coming, another (former) BOJ official warns
- UN report: North Korea continues to violate sanctions, missile program intact
- Fed's Mester: Fed's wait-and-see approach on rates 'well-calibrated' to outlook
- Australia Retail sales for December: -0.4% m/m (vs. expected 0.0%)
- Australia trade balance for December AUD + 3681m (vs. expected AUD +2225m)
- Japan PMI: Services 51.6, and Composite 50.9 (priors 51.0 and 52.0 respectively)
- Politico report Trump plans to pick David Malpass as US nominee to lead World Bank
- NZD traders - heads up for the GDT dairy auction coming up (Wednesday?).
- US Treas says intends to 'hold China accountable' for unfair, market-distorting trade
- UK PM May says Brexit deal will honour commitments on Northern Ireland
- Australia - ANZ Roy Morgan weekly consumer confidence: 118.1 (prior 116.5)
- Australia - CBA services PMI (Jan Final) 51.0
- Trade ideas thread - Tuesday 5 February 2019
- Australia services PMI for January falls to 44.3 from previous 52.1
The Australian dollar dropped early in the session here from around 0.7220 down to under 0.7200. The drop came in response to a much worse than expected result for December retail sales (see bullets above). At the same time December trade data showed a larger than expected surplus, LNG continues to be a star but nevertheless, exports were down on the month. The boost to the surplus came from a sharp and broadly based fall in imports, likely not a healthy indication of the strength of domestic demand. Earlier in the session was a very poor indeed services PMI, but this data point tends not to move the currency upon release.
After the drop AUD inched its way back to cover the 'gap' down on the data (I should note the rages up to this stage had been very small indeed).
And so to the RBA. The Bank announced their first decision for the new year, 'on hold' as was widely expected. AUD/USD popped toward 0.7250 and as I update has poked its nose above there.
Through the early part of the session NZD outperformed the AUD. It lost a few points early alongside the weaker AUD but soon recovered to a fresh session high (data from NZ today showed the first rise in 8 months for ANZ's measure of export commodity prices).
Elsewhere for major currencies action has been more subdued. China, HK, Singapore were all out on holidays today (and are all out again tomorrow). Expectations of 'falsh crashes' due to limited liquidity have so far proved unfulfilled.
Gold gained a few $.
Note in the comments above some US/China trade comments from the US Treasury, also from Fed (Cleveland President Mester), all with little impact on the session.
Still to come:
