Forex news for Asia trading on Thursday 28 October 2021
- BOJ monetary policy statement & revised forecasts
- Goldman Sachs revise their forecasts for the Bank of Canada
- Australian April 2024 bond yield is 0.5%, 5 times higher than the RBA target
- Oil is losing ground, WTI and Brent both dropping
- CBA's RBA forecast is for a November 2022 rate hike
- USD a little higher on the session so far - but mixed
- ANZ forecasts the RBA to hike in H2 of 2023
- PBOC sets USD/ CNY central rate at 6.3957 (vs. estimate at 6.3926)
- AUD - Westpac say again they expect the RBA to hike the cash rate in February 2023
- RBA Dep Gov Debelle says aim of monetary policy is to generate higher inflation
- Q3 Australian export & import prices both much higher than expected
- RBA not buying April 2024 Australian government bonds today
- Japan Retail sales for September -0.6% y/y (expected -2.3%)
- AUD traders - heads up for 0015 GMT and whether the RBA will be buying bonds
- US Senator Manchin says he believes a deal on Biden's plan might be reached Thursday
- More on the US SEC to ban Bitcoin leveraged fund
- Brazil's central bank has hiked its benchmark rate by 1.5%
- US House Democrats have added an extra meeting for Thursday morning - said to be a key for Biden's hopes
- US regulator said not to allow leveraged Bitcoin Fund
- Trade ideas thread - Thursday 28 October 2021
- ICYMI - Iran and the EU have agreed to restart negotiations on rebooting the 2015 nuclear accord
- US stocks sell off into the close. Dow and S&P lower. Nasdaq unchanged.
Australian interest rate markets were where there was some action on the session, but, spoiler alert, AUD was not much flustered by the rate moves.
The April 2024 Australian Commonwealth Government Bond is the Reserve Bank of Australia 'target' bond, where the bank is aiming to keep the yield at 0.1% or below. Last week the RBA bought this bond to attempt to drive the yield down from circa 0.17%. Today the Bank was scheduled to be in the market again, having announced it'd be buying 7-10 year Australian bonds. Markets were also waiting to see if the RBA would be buying the April '24 to drive the yield on that bond down again, and in order to keep its Yield Curve Control (YCC) intact. The RBA did not buy the April '24 bond though and its yield quickly rocketed higher to 0.5%.
All this comes in the wake of yesterday's inflation report (check out yesterday's wrap for the info and further links ICYMI) that has set markets and analysts clamouring for an earlier rate hike than the RBA's promised not earlier than 2024.
While all this was going on the USD was displaying a little strength, with EUR, GBP, NZD, CAD and CHF all lower against the dollar. AUD/USD was down also, the biggest of the losers (I should note none of the ranges were large). As I post though the weaker USD prevalent earlier in the session has reversed; EUR, GBP, CHF all have fully recovered their losses. AUD/USD and NZD/USD are retracing also although AUD/USD is lagging.
USD/JPY did not gain early but it too has lost ground.
Oil fell, coal also (extending its huge decline). Shanghai Comp is down 1%.
