Forex news for Asia trading Monday 14 March 2016

Monday:

  • A preview of the BOJ meeting today and tomorrow
  • In the bond markets it seems pandas might become more popular than kangaroos
  • CBA have picked out a significant point in today's Australian credit card data
  • We heard from Morgan Stanley on oil, more now, this time on equities
  • Oil update - Morgan Stanley says prices have likely bottomed
  • PBOC USD/CNY mid-point at 6.4913 & Injects 10bn yuan via 7-day reverse repos
  • China non performing loan securitization proceeding (buy one get one free?)
  • Japan data - Machine orders (January): +15.0% m/m (expected +1.9%)
  • NZIER quarterly consensus economic forecasts - lower inflation, faster growth
  • Explosion in Turkey: Ankara car bomb kills at least 32
  • Here's part 2 of the Goldman Sachs Federal Reserve FOMC preview
  • Goldman Sachs Federal Reserve FOMC preview (part 1, of 2)
  • RBNZ's McDermott: Rethink on rate outlook if inflation expectations fall further
  • Iran says it might join talks to freeze oil production, but not yet
  • NZ data - February Services PMI 56.9 (from 55.4 prior)
  • Trade ideas thread for Monday 14 March 2016
  • Monday morning FX - 14 March 2016 - foreign exchange prices, early indications

Weekend:

  • Merkel loses support in two state elections
  • The next 'big Soros bet' crushes hedge funds as yuan hangs tough
  • BOJ likely to discuss exempting $90bln in short-term funds from negative interest rates
  • UK's Osborne says "the hopes of a stronger global recovery have evaporated"
  • Merkel's refugee policy being tested today
  • Do we need more academic overview of central bank actions?
  • EU President Schultz does not favour Trump for US President
  • More from China: 1. Rating cut a 'misjudgement' & 2. No to circuit breaker reintro
  • Senior China official says will avoid widespread layoffs during overcapacity cuts
  • PBOC Zhou weekend comments: China growth target can be hit without overly easing
  • China industrial production, retail sales, fixed asset investment data out now
  • How to win when losing
  • Finland’s Minister of Finance is regretting this comment

Weekend data from China (a miss on industrial production and retail sales, while a beat on fixed asset investment) gave us an early morning dip on the AUD/USD. This shows up as a 'gap' on many charts and, as I have said before numerous times (too often to mention, but here I go again) a small gap against the trend on an early Monday morning is a strong candidate for a filling in. AUD/USD has since traded to a fresh trend high and above last week's highs. The strength looks set to continue.

NZD/USD displayed a similar pattern, though the extension in gains has not been evident, its still under last week's high.

Other weekend news was much worse, with tragic deaths in Turkey (more than 30 dead in a car bomb explosion) and the Ivory Coast (shooting at a beach resort killed 16 people).

USD/CNY was set today by the People's Bank of China at a barely changed rate from Friday's mid-point. Reports filtered through of large Chinese banks on the bid for CNH during the session which hints that the yuan gains may not yet be over.

USD/JPY traded a little lower in the Tokyo morning and then popped on the release of the Machine orders data - the data was a net yen positive but that didn't stop it from weakening. It tested (very briefly) to 114 and is below there as I update at more or less its session mid point.

USD/CHF and cable are both little changed from late Friday (USD/CHF up a small amount), while EUR/USD is a tad stronger.

Oil lost ground but is now not much changed from late Friday. Gold is up on opening levels by just a few dollars.

Regional equities are looking better today:

  • Nikkei +1.71%
  • Shanghai +2.58%
  • HK +1.32%
  • ASX +0.28% (the ASX hit a 10-week high today)

Still to come: RBNZ Governor Wheeler speaks at 1900GMT. Its a non-public speech that will not be reported. The RBNZ reasons that "the majority of our presentations are off-the-record to allow wider discussions with less risk of candid dialogue being misinterpreted".

More: Chinese Lenders Repay Loans Borrowed During Stock Rout