Forex - Asia Highlights - Friday, 13 September 2019


 05:05 (GMT) 13 Sep

  [Forex Highlights]

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Asia Highlights - Friday, 13 September 2019 (0101-NVMY-C01)

US News:
A mixed ECB package was initially seen as EUR negative but EUR/USD ended higher as front end yields rose. Rising UST yields and equities, supported by trade optimism, lifted USD/JPY above 108.

US News Highlights:
- US Aug CPI +0.1% as exp, ex food and energy +0.3% vs 0.2% exp.
- US initial claims fell to 204k from 219k vs 215k exp.
- ECB delivered a 10bp depo rate cut, 20bn of monthly QE, a cut to the TLTRO3 rate of 10bp, and aggressive tiering.

Currencies:
EUR/USD initially fell on the ECB's broad range of measures, with a low of 1.0925 coming after US core CPI exceeded expectations, though the reaction to the data was modest compared with that to the ECB. EUR/USD subsequently erased its losses and more, getting as high as 1.1086. Rate cut expectations reduced after the 10-bp cut.
USD/JPY slipped with UST yields after the ECB, the low of 107.50 coming after and despite the US core CPI strength. As yields bottomed so did USD/JPY, spiking up on a report that Trump advisers were considering an interim deal to delay tariffs, and while a White House denial erased that bounce, an move up eventually persisted through 108, guided by rising bond yields and equities.
AUD/USD came off a .6894 high on the White House denial and ended weaker. USD/CAD was choppy around 1.32, closing above the figure.
EUR/GBP dropped below .89 but ended slightly higher, though GBP/USD saw highs above 1.2350. EUR/CHF fell to 1.0850 before rebounding to see highs above 1.0950.
European data had little market impact. German and French final CPI were broadly in line with expectations. Eurozone industrial production was a little weaker than expected at -0.4% m/m, -2.0% y/y. Italian unemployment fell to 9.9% in Q2, the lowest since 2012. Swedish unemployment rose to 7.0% in August, which is the highest rate for the year.

Asia FX and News:
-Trump Said He'd Consider an Interim Trade Agreement With China
-DUP Said N. Ireland Can Take Some EU Rules Post-Brexit ~ Times
-Japan Firms Push Back Capex Plans as Trade Risks grow ~ Reuters survey
-Japan's Aso: Not Considering More Economic Stimulus Measures
-Trump said he would consider an interim deal with China while a full deal is still preferred which gave risk-on move a kick to extend further. AUD/USD rose higher while NZD/USD struggles to see gains as NZ manufacturing PMI remains below 50. Yen pairs generally higher. USD/JPY held above 108 with support from US yields and equities. EUR/USD fairly stable around 1.1060 following large swings on Thursday. DUP said N.Ireland will withdraw its protest to regulatory checks in the Irish Sea and will abide to some EU rules to replace Irish backstop. GBP unmoved on the news though some buying emerge closer to the European morning. USD/CAD retest Thursday's high around 1.3220.

Data:

JP: Capacity Utilisation (Jul) 1.1% m/m (Mkt: Prev: -2.6)

JP: Industrial Production (Jul F) 1.3% m/m (Mkt: Prev: 1.3)

JP: Industrial Production (Jul F) 0.7% y/y (Mkt: Prev: 0.7)

NL: Retail Trade (Jul) 5.2% y/y (Mkt: Prev: 0.1)

FI: CPI (Aug) 0.4% m/m (Mkt: Prev: -0.3)

FI: CPI (Aug) 1.1% y/y (Mkt: Prev: 0.8)

Still to be released:

06:00 GMT - DE: Wholesale Pric Index (Aug) % y/y (Mkt: Prev: -0.3)

07:00 GMT - ES: CPI (Aug F) % m/m (Mkt: -0.1 Prev: -0.1)

07:00 GMT - ES: Flash HICP (Aug F) % m/m (Mkt: -0.1 Prev: -0.1)

07:00 GMT - ES: Flash HICP (Aug F) % y/y (Mkt: 0.4 Prev: 0.4)

07:00 GMT - ES: CPI (Aug F) % y/y (Mkt: 0.3 Prev: 0.3)

07:30 GMT - SE: GDP (Q2 F) % q/q (Mkt: -0.1 Prev: -0.1)

07:30 GMT - SE: GDP (Q2 F) % y/y (Mkt: 1.4 Prev: 1.4)

09:00 GMT - EU: Trade Balance (sa) (Jul) EUR bn (Mkt: 17.5 Prev: 17.9)

12:30 GMT - US: Import Price Index (Aug) % m/m (Mkt: -0.5 Prev: 0.2)

12:30 GMT - US: Retail Sales (Aug) 4cast: 0.2% m/m (Mkt: 0.2 Prev: 0.7)

12:30 GMT - US: Retail Sales (ex Autos) (Aug) 4cast: 0.1% m/m (Mkt: 0.1 Prev: 1)

14:00 GMT - US: Business Inventories (Jul) 4cast: 0.4USD bn (Mkt: 0.4 Prev: 0)

14:00 GMT - US: Univ of Mich Sentiment (Sep P) (Mkt: 90.4 Prev: 89.8)

Events and Auctions

03:30 GMT - JP: 3mth Bills Auction

06:00 GMT - JP: Enhanced Liquidty Auction

10:00 GMT - UK: 91 days Bills Auction (GBP 2.5bln)

10:00 GMT - UK: 182 days Bills Auction (GBP 2bln)

10:00 GMT - UK: 28 days Bills Auction (GBP 2bln)


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