Forex news for Asia trading Wednesday 5 August 2015

China

  • China - Caixin Services (53.8) & Composite (50.2) PMIs for July
  • No SDR basket for you! IMF review recommends delaying currency basket adoption of yuan - Reuters
  • It worked. Beatings continued, morale improved! China - Shanghai Securities News says investor confidence rebounded in July

NZ & Australia

  • BNP's quickie advice on the AUD - fade the bounce
  • Australia - AiG services PMI for July: 54.1 (prior was 51.2)
  • NZD - Westpac says it expects Fonterra to cut 15/16 milk payout to $NZ3.70
  • New Zealand Q2 employment change: +0.3% q/q (vs. +0.5% expected)

Thursday is going to be just super!

  • Goldman Sachs have 3 things to expect on Super Thursday (and EUR/GBP target)I

More:

  • Japan - Nikkei Services (51.2) & Composite (51.5) PMIs for July
  • AEP: leading indicators, monetary data in US, Europe, China point to accelerating rebound
  • UK - BRC Shop Price Index for July: -1.4% y/y (prior was -1.3%)
  • Trade ideas thread for Wednesday 5 August 2015
  • API crude oil inventories: -2.4 mln barrels

If you missed the comments from Atlanta Federal Reserve President Lockhart during the US session you may be wondering why the USD is higher this European/UK morning. Greg had the headline, here: September could be appropriate for liftoff

A little more on his comments, he was speaking in an interview with the Wall Street Journal:

  • "I think there is a high bar right now to not acting, speaking for myself"
  • "It will take a significant deterioration in the economic picture for me to be disinclined to move ahead"

Lockhart is closely watched in the markets "because he tends to be a centrist among Fed officials who moves with the central bank's consensus" (quote from Jon Hilsenrath in the journal article). The USD was a beneificiary in the US timezone, and his comments reverberated through Asian FX markets today.

EUR and EUR crosses were weaker in the Tokyo morning, but this soon became broader currency weakness against the USD. Cable lost 30+ points, AUD and NZD were both lower and USD/JPY gained above overnight lows to approach 124.50. The Australian dollar is barely off session lows as I update.

CHF was notably unfussed, more or less unchanged on the session.

Oil popped a little higher on the API data at 4.30/4.35pm ET and despite a bit of a pullback its near session highs as I update. (Not that the move was large.)

Gold is tracking along near overnight lows.

Chinese Services PMI data today (see bullets, above) came in at an 11 month high. But both the Shanghai Composite and Shenzen exchanges are down at the lunch break. The IMF SDR report (see bullets, above) was cited as a contributing factor to Chinese share market falls today. Like they need another reason. AmIright?

For a bit of fun and amazement ....

  • Nope, not FX (better!) More on that real hoverboard - video.