Forex news for Asia trading on Thursday 27 May 2021
- China industrial profits in April strong again - recap
- South Korea's central bank governor says Bank will maintain easy policy for a while
- China will extend more support to micro & small enterprises (MSEs) and self-employed
- US Trade Rep Tai says China Phase 1 trade deal is very important
- US and China trade negotiators making positive noises after talks on phone
- China Industrial Profits for April +57.0% y/y (prior +92.3% y/y)
- Australian Private Capital Expenditure (capex) for Q1 2021: +6.3% q/q (expected +2%, prior +3%)
- PBOC sets USD/ CNY reference rate for today at 6.4030 (vs. yesterday at 6.4099)
- Coronavirus - Australia's second-largest state, Victoria, sent into a 7-day lockdown
- South Korea central bank leaves its key rate unchanged (as expected)
- China (non-Apple) smartphone makers slash shipment targets for 2021
- China says it supports probe in COVID-19 origins
- Biden prepared to extend infrastructure talks by up to two weeks
- ICYMI - Russia may be escalating its war with the EU over Belarus' state-sponsored hijacking
- China financial press says the RMB rate should be decided by the market
- Tesla is considering buying a factory to deal with semiconductor shortage
- China's bans lenders from selling commodity futures-linked products to retail investors
- US Dept of Justice is said to be opening an investigation into the Archegos blowup
- Japan is extending wages/employment support through to the end of July
- Cyprus to give mRNA vaccines to those under 50
- More from RBNZ Gov Orr - a negative economic shock would prompt increased stimulus
- RBNZ's Orr says the New Zealand labour market has been very resilient
- Magnitude 4.7 earthquake off the northern coast of Honshu, Japan
- RBNZ Gov. Orr says the Bank is willing to lower interest rates if necessary
- Trade ideas thread - Thursday 27 May 2021
The New Zealand dollar was the mover today, albeit not by much. NZD/USD slid during the early part of the session into and throughout testimony from Reserve Bank of New Zealand Governor Orr to a committee in parliament. Orr did not really add much to what he has said previously. In a nutshell he says that if the economy continues to improve as expected the Bank policy will tighten beginning in H2 (late in H2 most likely) of next year. As a hedge, he says that shocks to the economy will mean continued, and perhaps more, policy accommodation from the Bank (see bullets above). NZD/USD hit lows under 0.7270 and as I post is back on session highs just under 0.7295.
USD/JPY fell from highs circa 109.20 to around 109.08 as I post. Not much of a range in other major FX either with an absence of any news of impact as a catalyst.
On the data front we had Q1 capex data from Australia which surprised to the topside. This augers well as an input to Q1 GDP to be reported from the Australian Bureau of Statistics on June 2, estimates I have seen at this stage are for a 1.2% q/q GDP reading, and thereabouts. The Australian dollar was led around like an old, fat, slovenly dog on a leash by the NZD. Australia's second-largest population state was placed back into lockdown, for 7 days. Its fourth.
EUR, CAD both are little changed. Cable lost some ground but retraced some of its loss to be down slightly on the session.
BTC/USD is back under USD38K.
The US and China spoke on a phone call re trade, a high-level conversation between China's Vice Premier Liu He and US Trade Representative Katherine Tai.
Vice Premier of China, Liu He
