ForexLive Asia FX news wrap: NZD, AUD higher
Forex news for Asia trading Tuesday 8 October 2019
- More on HK leader saying Chinese military could step in
- FT again - US officials ponder supporting Huawei competitors
- Financial Times says the BOJ will face pressure to ease monetary policy
- Japanese prime minister Abe: Domestic demand fundamentals are firm
- China's Hikvision not happy with US blacklisting announcement
- Brexit - report doing the rounds is PM Johnson is preparing for exit talks to collapse
- China Caixin/Markit PMI Services 51.3 vs. 52.0 expected (& Composite comes in at 51.9)
- More on the projections that a no-deal Brexit likely to push UK budget deficit to 100 bn GBP
- PBOC sets USD/ CNY reference rate for today at 7.0726
- FX option expiries for Tuesday October 08 at the 10am NY cut
- Japan economy minister Nishimura comments on weak exports, worries among farmers on US deal
- Australia business confidence 0 (prior 1) & business conditions 2 (prior also 1)
- Australia ANZ survey of job advertisements for September: +0.3% m/m (prior -2.8%)
- New Zealand government report a surplus for the fiscal year
- Further gains for gold coming up? Medium term picture 'very constructive'.
- Japan Balance of Payment Current Account for August
- Japan Household spending for August: +1.0% y/y (expected -1.0%)
- Japan wages data for August - Labor cash earnings: -0.2% y/y (expected -0.2%)
- (Attn AUD traders) - Morgan Stanley say iron ore prices to fall
- Ahead of the FOMC minutes this week, a forecast of an October rate cut
- Australia weekly consumer confidence: 112.3 (prior 114.7)
- Goldman Sachs forecast for S&P500 is 3100 by end of Q4 2019
- Brexit - Goldman Sachs recommend long GBP/USD, citing low chance of no-deal exit
- More on the news that US Commerce Dept to add 28 Chinese firms to trade blacklist
- JP Morgan still like yen - 'the only cheap recessionary hedge left'.
- Trade ideas thread - Tuesday 8 October 2019
- More from Trump - "will see" if a trade deal can be made with China
- U.S. Commerce department to place China's Hikvision on blacklist
- US President Trump speaking on trade - hopes new NAFTA can come soon
While there was plenty of data out today and the odd piece of news market attention is very much focused on the US-China trade talks scheduled to commence later this week. US President Trump spoke in the US afternoon expressing he would prefer a comprehensive trade deal rather than a partial one.
At the same time, we had the US Commerce Dept announce that it had placed 28 Chinese firms on the "Entity List", restricting their ability to do business with American firms. This is quite a severe blow to these firms, they are not firms that have the ability to switch chip manufacture in house and are thus very reliant on firms like Intel and Nvidia. The Commerce Dept. cited concerns on Uigher (a Muslim minority in China) treatment in China in reasoning for the blacklisting. Disentangling this from trade talk may be an obstacle in the negotiations ahead.
A further eyebrow raiser was the FT reporting the US is considering credit support to Huawei competitors (see bullets above).
Despite this yen has lost some ground and AUD has gained some. A further less than positive factor for the AUD today was the NAB business survey showing business confidence falling to a 6-year low. AUD/USD moved from lows around 0.6730 to test towards 0.6750.
NZD/USD performed better. Early data from New Zealand showed a government surplus for the most recent fiscal year, alongside a lower than forecast government debt position. Kiwi $ rallied just shy of 35 points. CAD fared OK on the day, up 15 points or so against the USD (ie USD/CAD down)
EUR/USD is up small, as is cable. As mentioned, USD/JPY is up on the session and is around its US timezone high as I post.