Forex news for Asia trading Monday 16 November 2015

Monday:

  • Heads up for AUD traders: RBA events to monitor on Tuesday (Australia time)
  • Morgan Stanley on their short GBP/USD trade: rationale, target, & stop loss
  • Barclays technical strategist bearish AUDUSD, ... (targets) 0.6935/0.6895
  • China PBOC, commercial banks bought net foreign exchange in October
  • Japan press report extra budget to be around 3.5tln yen
  • China's markets regulator has started probing mutual funds for illegal activity
  • People’s Bank of China (PBOC) sets yuan reference rate at 6.3750
  • Japan economy minister Amari: Economy remains in moderate recovery trend
  • Australia data - October New Motor Vehicle Sales -3.6% m/m (+5.5% prior)
  • UK data: Rightmove House Price -1.3% m/m
  • Japan Q3 GDP (preliminary): -0.2% q/q (-0.1% expected)
  • More on Mersch: ECB stimulus decision depends on long-term trends
  • Xi says Chinese economy predicted to grow about 7%: Xinhua
  • NZ Retail Sales ex Inflation for Q3: +1.6% q/q (expected +1.4%)
  • New Zealand data - Services PMI for October: 56.2 (prior was 59.3)
  • NZD on the move - Fonterra increasing its forecast earnings per share range
  • Trade ideas thread for Monday 16 November 2015
  • AFP: French air force pounds IS stronghold in Syria, defence ministry says
  • US expanding intelligence sharing with France
  • Canada fin min Morneau: Lower CAD good for exporters, no FX intervention planned
  • Monday morning FX - 16 November 2015 - foreign exchange prices, early indications

Weekend:

  • What the Paris attacks mean for oil
  • Hundreds flee vigil in Paris, officials later signal all-clear
  • Fed's Rosengren says lending risks a reason to hike
  • In the aftermath of the Paris attacks what's next for financial markets
  • G20 pledge to use all policy tools to address uneven global economic growth
  • Forex trades for the week ahead from Credit Agricole
  • ECB stress tests reveal capital gaps totaling 1.74bn EUR among nine lenders
  • Canada fin min weekend comments in Turkey - fiscal update in 'near term'
  • Cable: UK economic recovery 'precarious, unbalanced', more 'severe economic storms' coming
  • IMF staff recommend yuan be included in the fund’s SDR reserve-currency basket
  • BNZ cuts New Zealand milk price forecast
  • Magnitude 5.9 earthquake hits off Japan
  • There are people with $159 million to spend on a house
  • Awful events in Paris will reverberate in Europe
  • Paris siege ongoing. 26 dead are being reported

The cowardly murders in Paris dominated Friday evening and weekend news flows and led to risk aversion moves as markets sequentially opened on Monday.

On local bourses, as they opened for cash trade, it was a story of lower openings, followed by some some recovery and stabilisation. Equity futures markets for cash markets not yet open, the S&P500 e-mini, for example, followed a similar pattern, a lower opening followed by partial recovery and stabilisation,

Currencies, of course, opened for trade before all, with the very early New Zealand market being the first to come fully online. This trading saw expected risk-aversion trade, to greater or lesser extents, with flows into yen and CHF, and a large impact on EUR. EUR/USD lost around 80 or so points from late Friday highs, with EUR crosses mainly a similar story.

EUR/USD has bounced somewhat, but its been unconvincing and it is tracking more or less sideways around 1.0720 and thereabouts as I update.

AUD is lower on the session, but not by a lot. NZD was an interesting one. It rallied on the news of Fonterra boosting their forecast for share earnings, but then fell back for little net change as I write.

Japan Q3 GDP came out, unsurprisingly, at a negative, and with very poor business capex showing, but with some positive take-aways as well, notably a slight beat for the consumer spending component and a gain for the inflation-indicating deflator. There was some chatter of declines in inventory being a positive for GDP going forward; we'll see. Yen, as mentioned, gained on risk aversion, but USD/JPY retraced much of its loss before stabilising.

Gold gained nearly $10, oil is up a few cents.

The yuan mid point was set weaker (for the yuan) for the 10th consecutive day. Weekend news is now pointing with near certainty for inclusion of the RMB into the IMF's SDR basket.

Regional equities with Shanghai closed for the lunch break:

  • Shanghai -0.51%
  • Nikkei -1.08%
  • HK -1.63%
  • ASX -0.67%