Forex news for Asia trading Thursday 01 October 2015

China

  • Caixin / Markit announce no more 'flash' China PMI
  • China Caixin Manufacturing PMI: 47.2 (47.0 expected) (Also services and composite PMIs)
  • China Manufacturing PMI for September: 49.8 (vs. 49.7 expected) (non-manufacturing PMI too)
  • PIMCO sees China GDP up 5.5 to 6.5% in the coming year
  • 9 of 13 big international firms surveyed says China growing at 3 to 5%, not 7%

Japan

  • Japan-Ruling party MP Yamamoto says no change in view BOJ needs to ease further in Oct.
  • ex-BOJ deputy governor Iwata says more easing is likely
  • Japan-Nikkei Manufacturing PMI for September (final): 51 (vs. 50.9 flash reading)
  • BOJ Tankan report for Q3: Large Manufacturing Index +12 (expected +13)
  • Nikkei: More economists see Japan's GDP contracting in July-September
  • Fitch expects China GDP 6.8%, 6.3% in '15 & '16, but if hard landing, to hit HK, Japan, Korea
  • South Korean exports fell 8.3% in August
  • Fed's Brainard comments on community banks, not economy or monetary policy
  • Australia CoreLogic RP Data house Prices for September +0.9% m/m (prior was +0.3%)
  • PIMCO on Australia, China, US, Japan-higher chance more BOJ easing
  • Australia data-AiG Manufacturing PMI for September: 52.1 (prior 51.7)
  • NZ data-September QV House Prices: +12.6% y/y (prior was +11.3%)
  • PIMCO's Kiesel: Fed would have to slam brakes if inflation picks up
  • PIMCO's Kiesel: Base case is Fed will raise rates in December
  • More on comments from Hansson on more (or not) ECB stimulus
  • Trade ideas thread for Thursday 1 October 2015

Following along from Wall Street's better equity performance on Wednesday Asian markets saw share market gains, a better bid AUD and NZD, and weaker yen, EUR and CHF.

The BOJ Q3 Tankan report was the early focus. It was a mixed result with some improvements and some declines (see bullets, above) but, on balance, is another sign of a Japanese economy that is treading water, at best.

Next up were the PMIs from China, both official and Caixin/Markit. Manufacturing PMIs (both) came in slightly ... ever so slightly ... ahead of expectations, but (both) still in contraction. Think 'less terrible' rather than 'good'. The official services PMI came in unchanged from the prior month, while the Caixin services PMI came in much lower than the previous month.

Services PMI does not get anywhere near the attention the manufacturing PMI gets ... this is a market blind spot and has been for a long time, and probably for a long time to come. I'm not here to argue with the market, not at all, but if the focus of the Chinese economy is to swing away from exports and manufacturing more towards services (and yeah, you can export services ... you're reading an example right now if you're not in Australia) then maybe paying a bit more heed to the services PMI is sensible.

I digress ...

Regardless of the Chinese data it was a better day for the AUD et al

  • Regional stocks:
  • Nikkei +2.2%
  • HK ... Closed today, back tomorrow
  • ASX +1.7%
  • Shanghai ... China is closed for the Golden Week holidays and will reopen on October 8