- China’s official PMI 53.1 in March, up from 50.6
- In contrast, HSBC and Markit Economics show PMI below 50 and exports falling
- BOJ Tankan shows sentiment flat and outlook cautious
- TD-MI Australian inflation gauge 1.8% YoY, comfortably below the RBA’s 2% target
- Australian building approvals much worse than expected at -7.8%
- All 18 economists polled by Reuters say that the RBA will leave rates unchanged tomorrow
- Moody’s upgrades South Korea’s ratings outlook
- Chinese financial markets closed for holiday
- Nikkei +0.8%; HK -0.5%; other regional Bourses +0.25% on average
- Gold $1672/oz; Oil $103.30/bbl
AUD/USD closed last week at 1.0360 but gapped 100 pips higher in early interbank trade after the surprisingly strong official Chinese PMI. The pair steadied around 1.0450 early on but soon started falling when the private sector Chinese data contradicted the official PMI. Domestic inflation and buildings approvals ensured that a ‘no-rate-cut’ decision tomorrow by the RBA is by no means a done deal. Ranges: 1.0382/1.0455
USD/JPY opened near 82.80 but found plenty of demand again both from importers and also from AUD/JPY buyers, early on at least. The rather disappointing Tankan also weakened the Yen somewhat but the rally ran out of steam just below 83.30 with exporter offers sitting not far above there. Ranges: 82.73/83.28.
EUR/USD edged higher alongside the AUD/USD and also on EUR/JPY demand but bulls were happy to book profits ahead of recent highs at 1.3385. Weekend statements on the bailout mechanism were generally ignored yet again, with the Asian market trading regional issues. Ranges: 1.3328/76
Cable opened above its 200-week MA at 1.6008 but couldn’t maintain the momentum and will end the session near its NY close from Friday. Ranges: 1.5982/1.6025
EUR/CHF 1.2034/44
