Forex news for Asia trading on Tuesday 16 November 2021
- China's state planner says it'll charge punitive rates on households mining crypto
- RBA Gov Lowe Q&A now - says will not hike rates to control house prices
- Yuan adding on extra strength following comments earlier
- Bitcoin sliding just under $62K. Comments out of Twitter on volatility as a reason not to invest in crypto for now.
- RBA Gov Lowe: Underlying inflation at 2.5% would not be enough for a rate hike
- Goldman Sachs outlook for the US economy and Fed policy
- Xi's comments heading into the summit with Biden
- PBOC sets USD/ CNY central rate at 6.3924 (vs. estimate at 6.3921)
- China analysts say the onshore yuan may deviate from the US dollar index
- The Xi - Biden summit has begun
- RBA November minutes: Repeats no hike to cash rate until wage & inflation criteria are met
- AMC is readying to accept Shiba Inu for payment
- NZD traders - heads up for the GDT dairy auction coming up Tuesday 16 November 2021
- Rumour of an 'imminent' announcement on Biden’s pick to chair the Federal Reserve
- Fed's Kashkari says FOMC should not overreact to what are likely temporary factors
- Lagarde's comments on Monday were very effective ... at cutting the EUR
- China's President Xi and US President Biden are meeting Monday evening (US time)
- Australia weekly consumer confidence 106.0 (prior 109.0)
- Trade ideas thread - Tuesday 16 November 2021
- NASDAQ and Dow close lower. S&P trades near unchanged
- Fed's Barkin says the infrastructure bill is not a near-term stimulant
China's President Xi and US President Biden met Monday evening (US time) / Tuesday morning (China time) for a virtual summit. While we await readouts from each side the initial 'meet and greet' reports were encouraging, with both sides making positive remarks (see bullets above). This, of course, is hardly surprising, the public part of the summit is not where the difficult issues are discussed, As I post the private discussions are still ongoing.
FX markets took encouragement though, yen crosses gained. As too did USD/JPY (to circa 114.30) and notably AUD/USD (to just above 0.7365). GBP, NZD and CAD also moved higher against the dollar while EUR continued its lagging ways with only a very small rise against the USD.
There was strength also for the Chinese yuan, both the on- and offshore (CNY and CNH). The move higher for the yuan followed reports in Chinese media that the onshore yuan was expected to diverge from the USD index. Given the USD has been strong this implied even greater yuan strength, that we subsequently got (see bullets above).
The governor of the Reserve Bank of Australia, Philip Lowe, spoke today, giving a little more explicit guidance than he has done in the past on what sort of metrics the Bank is looking at for any rate hike that may be ahead (see bullets above)... although these are still a ways off.
The crypto complex saw further falls during the session. BTC/USD is circa US$61K as I am posting. Remarks from Twitter's CFO on being wary of its volatility and also from China's state planner (the NDRC) promising harsher crackdowns were not positive for it.
AUD/JPY rose heading into the Xi-0Biden summit:
