Forex news for Asia trading Monday 1 February 2016

China

  • Currency War: U.S. Hedge Funds Mount New Attacks on China’s Yuan
  • PBOC now reported to be injecting funds 10bn through 28-day reverse repos
  • China official manufacturing PMI recap ... 3 year low, longest below 50 stretch on record
  • China January Caixin manufacturing PMI: 48.4 (expected 48.1)
  • China stockmarket opening indications - Shanghai Comp to open down 0.2%
  • People’s Bank of China (PBOC) sets yuan reference rate at 6.5539
  • China manufacturing PMI for January 49.4
  • China January Services PMI 53.5 (December 54.4)

Australia and New Zealand:

  • NZ Treasury's Monthly Economic Indicators: "global economic outlook deteriorates"
  • Australia - Preview of the RBA monetary policy meeting Tuesday 2 February 2016
  • Australia: TD Securities inflation (January): +0.4% m/m (prior +0.2%)
  • Australia house prices data for January, +0.9% (flat in December)
  • Moody's on Australia - Mining regions starting to see signs of stress
  • Australian Manufacturing PMI for January: 51.5 (prior 51.9)
  • Sth Korean exports fall most for nearly 6.5 years
  • Japan - stocks higher, bond yields falling
  • Japan data - Nikkei Manufacturing PMI for January: 52.3 (prior 52.4)
  • Goldman Sachs technical analysis on oil - looking for a rally
  • "The wisdom of crowds". "The crowd is always wrong". Which is it?
  • BOJ negative interest rate - DB on the "most important takeaway"
  • ECB President Draghi to speak on Monday - monetary policy, euro on the agenda
  • UK's Cameron, EU's Tusk agreed only one of 4 points in weekend talks
  • Brexit - UK / Europe “new deal” discussions "go down to the wire"
  • UK / EU negotiations: Cameron, Tusk say no deal yet, talks to continue
  • Trade ideas thread for Monday 1 February 2016
  • Toyota may temporarily halt car production in Japan - due to a steel shortage
  • Monday morning Forex prices, early indications

Weekend:

  • February forex seasonal trades: Oil's well
  • BOJ's move to fuel currency wars: Trade opportunities - Credit Agricole
  • ECB's Nouy says banking regulations need to have one interpretation
  • UK's Cameron wants a better deal on the EU "emergency brake"
  • Winter, kids stuck inside. Getting fractious, bickering.
  • Greek bailout review talks to start Monday - this could take some time
  • Buzzer beaters...They feel great!
  • Latest poll has UK voters wanting to stay in the EU
  • Iran cancels conference in London to introduce new contracts
  • ECB's Visco says they are doing what they can but government reforms needed

Markets opened after a weekend with little in the way of market-moving news. Chnages from Friday's levels for currencies were marginal if at all.

It didn't take long, though.

Early Japanese markets saw record lows in Japanese bond yields as the 2 year hit -0.095% and 10 year at 0.065%. Anyone looking at the Australian and New Zealand dollars and thinking 'high yield'?

News then from South Korea on the trade data for January showed, yet again, evidence of low global demand: exports -18.5%y/y (and, for the record, imports -20.1%)

China PMIs followed and yet again they were poor, contraction in the manufacturing PMIs, both the official and private, offset somewhat by expansion in the official services PMI.

AUD and NZD had lost ground into the data, only to bounce afterwards. We're not talking huge moves, but they were reasonable, down around 30-40 points before a rebound.

Meanwhile, USD/JPY had gained, bouncing from around 121.05 to near 121.50 before giving nearly all of it back. The Nikkei had a positive session.

Cable gained from earlier lows, as did EUR/USD, while USD/CHF had a mirro image of these (dripping lower from earlier highs).

Oil lost some ground, gold gained.

Regional equities:

  • Nikkei +1.78%
  • Shanghai -1.78%
  • HK -0.87%
  • ASX +0.70%