- Yuan finds buyers - state banks intervention likely, selling USD/CNH
- Bank of England MPC member Haskell speaking Friday, 19 May 2023
- Increasing flow of yen overseas to pay for video & music streaming a drag on yen (but ...)
- China is considering moving stakes in bad banks to sovereign wealth fund
- TD forecast higher EU inflation and thus many more ECB rate hikes (4% terminal)
- PBOC sets USD/ CNY reference rate for today at 7.0356 (vs. estimate at 7.0392)
- BOJ Gov Ueda says a US debt default would have a huge impact on global economies
- President of the European Council says will restrict sale of Russian diamonds
- China Securities Journal blames the falling yuan on rising US dollar
- USD/JPY chart after the soaring Japanese CPI data ... finally responding
- ICYMI: Saudi Arabia says coordination with OPEC+ members a cornerstone of oil stability
- Japan CPI data comes in well above 3% again, core-core is above 4%
- The UK has imposed new sanctions on Russia, targeting the minerals sector
- UK data - May consumer confidence -27 (expected -27, prior -30)
- New Zealand April trade data: Exports beat, imports miss
- Oil - Buffett's Berkshire Hathaway has bought more Occidental Petroleum
- G7 countries plan a restriction on Russia's diamond trade
- US Debt default could trigger recession, Harris and Brainard warn
- AUD - Citi expect an RBA pause in June and another hike by August. Bearish AUD/NZD.
- US and Taiwan have reached an initial agreement on a "21st Century" trade agreement
- Forexlive Americas FX news wrap 18 May: Fed's Logan leans toward a June hike
- UBS sees three reasons to buy gold
- S&P index closes just below the key 4200 level
- Poll shows most analysts expect a +25bp RBNZ rate hike on May 24
Japanese inflation data was the focus for the day. April CPI came in higher than March in another acceleration. The Bank of Japan insist inflation is expected to fall from around October. Note the ‘transitory’ inflation argument has not worked out well at all for other DM central banks. Earlier this week a rise in power bills was approved in Japan. This will be a tailwind for higher headline inflation in the June figures once the rises kick in.
USD/JPY responded, slowly, to the rise in inflation, the yen rose to push USD/JPY below 138.40 at one stage. A small range only for it.
Japan's Nikkei 225 hit its highest since August 1990.
The big FX mover was the yuan. The People's Bank of China confirmed the mid-rate for the onshore yuan well above 7 for USD/CNY today. However, solid selling was seen in USD/CNH a little after, the market chatter (not confirmed) being Chinese state bank intervention to slow the yuan's decline. Chart below but, as I update, USD/CNH is even lower having dipped to circa 7.05 briefly.
Also from China, the Ministry of Finance is proposing to move its stakes in 3 firms managing bad debts into China's sovereign wealth fund (see bullets above).
Asian equity markets:
Japan’s Nikkei 225 +1%
China’s Shanghai Composite -0.5%
Hong Kong’s Hang Seng -1.4%
South Korea’s KOSPI +0.6%
Australia’s S&P/ASX 200 +0.6%
