- China's Navy have ramped up combat drills in the East China Sea near Taiwan
- China April Caixin/Markit PMIs Services 36.2 (expected 40)
- Australian Building Approvals for March 2022 -18.5% m/m (vs. expected -12.5%)
- Australia's trade balance for March 2022 AUD 9314m surplus(expected +8500mn)
- PBOC sets USD/ CNY reference rate for today at 6.5672 (vs. estimate at 6.5695)
- China services PMI for April data coming soon - further slump expected.
- HK's 'central bank' has (as always) followed the Fed and hiked by 50bps
- ICYMI - The PBOC has pledged further monetary policy support
- Japanese markets are closed for holidays Thursday 05 May 2022
- Moody's downgrades El Salvador, says possibility of a "credit event" highly serious
- ICYMI - RBNZ Governor Orr spoke to parliament - defended early rate hikes
- Brazil's central bank hikes its benchmark Selic rate by 100bps to 12.75%, as expected
- Bank of England preview - rate hike today, more to come
- Central bank meddling will continue until morale improves - Bank of England coming up
- Forexlive Americas FX news wrap: Dollar lower as Powell takes 75 BP hikes off the table
- Trade ideas thread - Thursday 05 May 2022
- Goldman Sachs revises its FOMC July forecast to +50bps from +25
- US says its preparing for an agreement with Iran on Nukes AND for no agreement with Iran
After wild moves following the Wednesday FOMC statement and especially the subsequent press conference from Chair Powell, markets traded in a much more subdued fashion here in Asia. Japanese markets were once again closed for a holiday, although China was back after its holiday break.
Fresh news flow was basically absent.
On the data front we had international trade numbers from Australia, and also building permits. Neither moved AUD.
From China we had the privately-surveyed April services PMI (Caixin/Markit). This collapsed to its second-worst reading on record. Given the wider spread of lockdowns and restrictions in China over the month, and the slump in the official services PMI that was published over the weekend the poor result was hardly a surprise.
As said above, forex movement was subdued. Most of the majors are little changed. The People’s Bank of China set its onshore yuan reference rate for the first time this week (the aforementioned holidays meant no CNY central rates were fixed this week by the PBOC before today), significantly stronger for the CNY compared to its previous close.
Gold gained further, to US$1900+.