- S&P downgraded Spain by one notch to ‘AA-‘ and placed them on negative outlook
- Chinese inflation data came in bang on expectations, down from 6.2% last month
- There will be increasing talk now that PBOC may introduce easier policy before Christmas to avoid hard landing
- USD/CNY fixed slightly higher at 6.3 maintains policy of SGD appreciation but at a slower rate
- Monetary Authority of Singapore maintains policy of SGD appreciation but at a slower rate
- Japan FinMin Azumi calls on G20 FinMins to learn from Japanese experience and use large fund bail-out
- Regional stocks fall by 1% on average; Gold steady at $1667/oz
Pretty quiet overall apart from some swift moves in the EUR/USD, AUD/USD and USD/SGD.
EUR/USD closed in NY at 1.3770 and traded quietly until the S&P downgrade of Spain, which saw EUR/USD fall quickly to 1.3732 before steadying. It traded with a heavy tone until the MAS announcement sent USD/SGD 100 pips lower and this gave EUR/USD a brief lift to 1.3770 again. We have since then seen a fresh intraday low at 1.3720 but overall its been very quiet. 1.3720/75
AUD/USD fell initially alongside the EUR/USD, rallied sharply when USD/SGD fell, eased again when EUR/USD made its session lows and then rallied back towards session highs post China CPI. Overall range 1.0142/93
USD/SGD was the big mover, falling from 1.28 to 1.27 after the MAS wasn’t as aggressive as had been feared. It finishes lower on the day but mid-range for the session.
USD/JPY 76.82/98; USD/CHF .8968/.9008
