Forex - Asia Open - Overnight Highlights


 00:02 (GMT) 24 Apr

  [Forex Highlights]

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Asia Open - Overnight Highlights (0101-KNSZ-C01)

Asia Overnight Highlights - 24 April 2019

ASIA OUTLOOK

Equities saw a fresh high buoyed by earnings, notably Twitter, and the USD was stronger, but despite this UST yields fell.

Majors FX Highlights

The USD strengthened across the board in the European afternoon/North American morning, perhaps helped by solid new home sales data, though most of the move came before the release. USD/CAD, looking towards Wednesday's BoC meeting rather than oil, moved above 1.3400. AUD/USD steady at .71 ahead of Australian CPI.
A Trump tweet threatening the EU over tariffs imposed on Harley Davidson added to the EUR's concerns after the weak data on Thursday, though a move in EUR/USD below 1.12 was brief. A dip in EUR/GBP was corrected with growing talk PM May might have to stand down sooner causing concern, cable touching a low of 1.2926.
USD/JPY was unable to sustain a brief move above 112.00, falling UST yields eventually outweighing strength in US equities.

Majors Data Highlights

Existing home sales data yesterday made signs of a revival in housing demand look quite modest. New home sales data today make it look quite strong, with a 4.5% increase to 692k, the highest since Nov 2017. This was the third straight monthly gain. Survey measures of housing demand have also improved in Q1, a less hawkish Fed helping. Back month revisions were modest.

Australia Q1 CPI will be the highlight on Wednesday in Asia. A weak print will further pressure the RBA to lower rates. There is limited scope for AUD weakness on rate cut bets with rate cut expectations for the August meeting still 50-50 and more than 1 but less than 2 rate cuts priced in this year. However, any surprise to the upside on the data will likely trigger a sharper reaction given AUD weakness prior to the release. We are expecting a faster rise in inflation than the market, 0.3% q/q vs. 0.2% q/q. If we are right, AUD/USD could jump to the upper end of the 0.71 handle, though it seems unlikely to break above key resistance above 0.72.
For the CAD, the focus is much more on interest rate spreads, especially with the BoC meeting on Wednesday. The BoC seems likely to be more dovish than the last time around, and this suggests some upside risks for USD/CAD even though the market probably expects something more dovish, mainly because the US curve is currently pricing more aggressive cuts from the Fed than the Canadian curve is for the BoC. This seems hard to justify given the relative performance of the economies and the weakness of the Canadian housing market, so we would see risks weighted towards a continuation of the USD/CAD strength this week.

Emerging Asia FX Highlights

USD/CNY: 1Y NDFs nudged higher to 6.7700 overnight on Tuesday, and further gains were limited. On Tuesday, PBoC fixed mid-point at 6.7082 vs. previous close of 6.7122.USD/SGD pushed higher overnight to an over 1-month high of 1.3585, but pared some gains thereafter to 1.3570. USD/IDR: 1M NDFs edged higher to 14196 overnight but erased some gains thereafter to 14180 at last look. USD/INR: 1M NDFs saw a range-bound overnight session, traded mostly between 70.0000-70.2000.

Emerging Asia Data Highlights

Singapore's headline inflation edged up slightly to 0.6% y/y in March from 0.5% y/y prior, whereas core inflation eased slightly to 1.4% y/y during the same period.

Wednesday will see the release of Malaysia's CPI for March. We expect it to remain in deflationary territory again with a print of -0.3% y/y vs. -0.4% y/y previously. Domestic fuel prices remain lower than last year despite some recent recovery.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar new home sales +4.5% to 692k vs 649k exp.

- VIX index: 12.28 (-1.13%)

- Gold Spot: $1,271.61/oz (-0.07%)

- ICE Brent front contract: $74.51 (+$0.47)

- Nymex WTI front contract: $66.03 ($-0.27)

- Reuters/Jefferies Commodities Index: 187.58 (-0.18%)

- 10y UST: 2.565% (-2bp) (Asia morning)

- DJI: 26,656.39 (+0.55%); S&P: 2,933.68 (+0.88%); Nasdaq: 8,120.82 (+1.32%)

ASIA NEWS

China: PBOC Denies Rumours of Targeted Reserve Cut for Rural Banks. - BBG

Indonesia: Bank Indonesia's Monetary Policy to Focus on Stabilizing Economy. - BBG

India: India's RBI Switches to Bond Purchases After Forex Swap Success. - BBG

Asia Open - Overnight Highlights (0101-KNSZ-C03)

CURRENCIES

The USD strengthened across the board in the European afternoon/North American morning, perhaps helped by solid new home sales data, though most of the move came before the release. USD/CAD, looking towards Wednesday's BoC meeting rather than oil, moved above 1.3440. AUD/USD slipped below .71 ahead of Australian CPI, though AUD/CAD found buyers below .95.

A Trump tweet threatening the EU over tariffs imposed on Harley Davidson added to the EUR's concerns after the weak data on Thursday, though a move in EUR/USD below 1.12 was brief. A dip in EUR/GBP was corrected with growing talk PM May might have to stand down sooner causing concern, cable touching a low of 1.2926.

USD/JPY was unable to sustain a brief move above 112.00, falling UST yields eventually outweighing strength in US equities.

There was little news of real note in Europe. ECB council member Benoit Coeure admitted the slowdown in Germany had been stronger than expected, but still expects an H2 Eurozone recovery if there are solutions to the trade conflict. He didn't see any monetary policy reason for tiered interest rates.

EUR/CHF showed the most significant move in the morning, breaking to new highs for the year though much of the move was later reversed. While there was no obvious trigger, low FX volatility may have increased the demand for carry and led to more use of the CHF as a funding currency. The SEK was also weak, though this may relate to the Riksbank meeting this week and the strength of oil increasing long NOK/SEK positioning.

Asia Open - Overnight Highlights (0101-KNSZ-C04)

BONDS

USTs proved well bid from the short end into 2yr supply, which saw a respectable reception. Better Eurodollar performance, particularly call option structures, well noted as helping to spill over into the short end lift, followed up by buying in the belly and 10yr option demand. Action seemed flows / hedging driven more than anything. Indeed, mini rally comes in the face of new home sales data that was quite 'bearish' by adding to evidence of a housing recovery. 2s -2.3bps @ 2.36%, 5s -2.7bps @ 2.36%, 10s -2.0bps @ 2.57%, 30s -1.1bps @ 2.98%.

Agency Spreads: Freddie/Fannie 5s -0.4/+0.6 bps, 10s -0.2/-0.5 bps.

Swap Spreads: 2s -0.11bps, 5s -0.10bps, 10s -0.36bps.

EQUITIES

The S&P touched a fresh all-time high, with earnings data giving support, most notably from Twitter. While the NASDAQ outperformed, it was the recently struggling health care sector that led the S&P's gains

Asia Open - Overnight Highlights (0101-KNSZ-C02)

ASIA CURRENCIES

USD/CNY: 1Y NDFs nudged higher to 6.7700 overnight on Tuesday, and further gains were limited. On Tuesday, PBoC fixed mid-point at 6.7082 vs. previous close of 6.7122. Onshore spot extended its uptrend during late Asian hours on Tuesday, but still remained shy from 6.7300 handle.

USD/CNH: pair traded with a slight upside bias overnight, and tested the 6.7300 handle. Further gains were capped, and pair was last seen at 6.7280. We expect pair to eye the 6.7300 handle. If broken, will turn our attention to the 6.7500 resistance next.

USD/SGD pushed higher overnight to an over 1-month high of 1.3585, but pared some gains thereafter to 1.3570. Eyes on 1.3581 resistance, a firm break of that resistance will signal further upside momentum. On the data front, Friday will see the release of Singapore's Q1 unemployment rate and March industrial production.

USD/IDR: 1M NDFs edged higher to 14196 overnight but erased some gains thereafter to 14180 at last look. The onshore spot traded horizontally on Tuesday. Range was between 14075 and 14086 until last look, as markets awaited the Bank Indonesia decision due on Thursday. We expect the bank to remain cautious as final election counts are still due, although risk of rate cuts in H2 is increasing. We expect 13890 support to stand firm for now unless a Jokowi victory is confirmed, and risk of moves towards 14100 will increase if BI turns dovish.

USD/INR: 1M NDFs saw a range-bound overnight session, traded mostly between 70.0000-70.2000. Onshore spot pared some earlier gains during late Asian hours, and was last seen at 69.6000. Risk of break to the 70 handle has arisen due to oil price gains amid the election uncertainties, although we do not see much room above that as RBI is dovish.

DATA RELEASES DUE TODAY

- 01:00 GMT - AU: Internet Skilled Vacancies (Mar) [Prev: -0.9]

- 01:30 GMT - AU: CPI (Q1) [Prev: 1.8]

- 04:00 GMT - JP: Leading Indicator (Feb F) 4cast: index (Mkt: Prev: 97.4)

- 04:00 GMT - MY: CPI (Mar) 4cast: -0.3% y/y (Mkt: 0.3 Prev: -0.4)

- 08:30 GMT - UK: Public Borrowing (PSNB ex banks) (Mar) 4cast: GBP bn (Mkt: 0.4 Prev: 0.2)

- 08:30 GMT - UK: Public Finances (PSNCR) (Mar) 4cast: GBP bn (Mkt: Prev: 0.6)

- 14:00 GMT - CA: BoC Rate (43579) 4cast: 1.75% (Mkt: 1.75 Prev: 1.75)

- 23:00 GMT - KR: GDP (Q1 P) 4cast:2.4 %y/y [Mkt: 2.5, Prev: 3.1]

- 23:00 GMT - KR: GDP (sa) (Q1 P) [Mkt: 0.3, Prev: 1]

EVENTS & AUCTIONS

- 10:30 GMT - EU: ECB Long-Term Refinancing Operation Result

- 13:15 GMT - UK: Finance Minister Hammond speaks in London

- 14:00 GMT - CA: Bank of Canada announces key policy interest rate and Monetary Policy Report

- 15:15 GMT - CA: Bank of Canada's Poloz and Wilkins speak in Ottawa

- 16:30 GMT - US: 2yr Floating Rate Notes Auction

- 18:00 GMT - US: 5yr Notes Auction


Forex - Chart USD/KRW Update: Strong rally last session turning focus towards the 1144.90 hurdle


 00:14 (GMT) 23 Apr

 [Forex Charts]

Please view the story for more information...


Forex - Asia Open - Overnight Highlights


 23:27 (GMT) 22 Apr

 [Forex Highlights]

Asia Overnight Highlights - 23 April 2019

ASIA OUTLOOK

On a subdued Easter Monday gains in oil price as the US stated it would eliminate waivers on purchases of Iranian oil the main story, giving a modest lift to the CAD. Elsewhere EUR/USD corrected higher but Cable remained weak.

Majors FX Highlights

The Bloomberg dollar spot index was little changed on Monday, and traded quietly around 97.400 before dipping slightly to 97.300 in the NY session. Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675. USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

Majors Data Highlights

US Mar existing home sales at 5.21m are fairly close to the average of Feb's strong 5.48m and Jan's weak 4.93m. While a little above Q4's average they are close to levels seen in Sep, Oct, and Nov. The picture is of a housing market stabilizing, perhaps modestly improving, after trending lower through most of 2018.

New home sales are due in the US, expected to correct lower by 3.3% to 645k. Europe remains quiet but UK MPs return to the parliament. This week therefore is one in which a new parliamentary process could begin in an attempt to find a consensus. This could by either through new indicative votes or the government introducing the bill, which MPs could amend, either to add a confirmatory referendum or soft Brexit options such as a customs union.

Emerging Asia FX Highlights

USD/Asians traded mostly higher earlier on Monday before retreating slightly and entering consolidation. USD/CNY 1Y NDFs shot up again to 6.7600 handle in late Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. USD/SGD was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. USD/IDR 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. USD/INR 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure.

Emerging Asia Data Highlights

Singapore's March CPI will be on focus today - the first one after the MAS decided to keep policy on hold.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar existing home sales -4.9% to 5.21m vs 5.30m exp.

- VIX index: 12.42 (+2.73%)

- Gold Spot: $1,275.18/oz (+0.02%)

- ICE Brent front contract: $74.04 (+$2.07)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.92 (+0.42%)

- 10y UST: 2.589% (+3bp) (Asia morning)

- DJI: 26,511.05 (-0.18%); S&P: 2,907.97 (+0.10%); Nasdaq: 8,015.27 (+0.22%)

ASIA NEWS

China: China will use "high-level" opening up measures to push for reforms, Xinhua reports, citing a meeting of the Central Committee for Financial and Economic Affairs chaired by President Xi Jinping. - BBG

Indonesia: Indonesia's 2019 budget deficit at 0.63% of GDP as of March compared to 0.58% in same period last year, according to statement from Finance Ministry. - BBG

India: Indian state refiners have firmed up oil supplies from alternate sources to replace Iran oil volumes for next month as contingency plan for non-renewal of U.S. waivers, a govt official says. - BBG

CURRENCIES

Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675.

USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

BONDS

USTs predictably quiet given the European holiday although the o/n move higher in yields does leak out further into the US session as oil bounce takes root. Lift in oil on the US Iran waiver end story encouraged USTs to trim back Friday's short covering burst. Existing homes data drops back broadly as expected, shrugged off. Curve a touch steeper despite the pending short end supply. 2s +0.6bps @ 2.39%, 5s +1.7bps @ 2.39%, 10s +3.1bps @ 2.59%, 30s +3.3bps @ 2.99%.

Agency Spreads: Freddie/Fannie 5s -0.7/-0.8 bps, 10s 0.0/-0.7 bps.

Swap Spreads: 2s -1.18bps, 5s -0.60bps, 10s -0.69bps.

EQUITIES

Equities saw a quiet day with strength in energy as oil prices increased balanced by modest losses in most sectors. A fairly light earnings calendar had little impact. Haliburton was subdued after announcing its results.

ASIA CURRENCIES

USD/CNY: 1Y NDFs shot up again to 6.7600 handle IN LATE Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. On Monday, PBoC fixed mid-point at 6.7035 vs. previous close of 6.7049. Onshore spot traded with an upside bias as well, and inched up to 6.7150 highs on Monday. We expect pair to eye the 6.7233 resistance next.

USD/CNH: Pair peaked at 6.7192 earlier on Monday before trading horizontally around 6.7150 again in the overnight session. China's politburo reiterated the need for a prudent monetary policy and remained cautiously optimistic, despite stronger than expected Q1 economic growth. We expect pair to eye the 6.7300 handle. If broken, will turn our attention to the 6.7500 resistance next.

USD/SGD: Pair was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. Focus for today will be on Singapore's March CPI. We expect headline inflation at 0.6% y/y in March (0.5% in February) and core inflation at 1.5% (1.5% prior). Pair is likely to eye the 1.3581 resistance next, before seeing a reversal to the 1.3510 support.

USD/IDR: 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. Onshore spot traded with a slight upside bias after the long weekend and opening flat at 14045. Pair inched up to over 1-week highs of 14096 as opponent Prabowo challenged Jokowi's victory in the presidential elections, which keeps threats of protests still alive. Oil prices were also on an uptrend, weighing on the rupiah but upside for USD/IDR possibly seemed capped and pair dropped back to 14080 into the close. We expect 13890 support to stand firm for now unless a Jokowi victory is confirmed, and a firmer break above 14090 remains likely.

USD/INR: 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure. Onshore spot gapped higher to open at 69.7500 after the long weekend vs. last close of 69.3550 as oil prices rallied on reports that US could end Iran sanction waivers. Pair traded to fresh 6-week highs of 69.8700 in early trading, before retreating to sub-69.7000 levels in the afternoon. Risk of break to the 70 handle has arisen due to oil price gains amid the election uncertainties, but we do not see much upside above it as the RBI has kept the door open for more rate cuts.

DATA RELEASES DUE TODAY

00:30 GMT - JP: Nikkei PMI Mfg (Apr P) index (Mkt: Prev: 49.2)

05:00 GMT - SG: Core CPI (Mar) 4cast: 1.5% y/y (Mkt: 1.7 Prev: 1.5)

05:00 GMT - SG: CPI (Mar) 4cast: 0.6% y/y (Mkt: 0 Prev: 0.5)

08:00 GMT - TW: Industrial Output (Mar) % y/y (Mkt: -1.5 Prev: -1.8)

08:30 GMT - HK: CPI (Mar) % y/y (Mkt: 2.2 Prev: 2.1)

12:30 GMT - CA: Wholesale Sales (Feb) [Prev: 0.6]

13:00 GMT - US: FHFA House Price Index (Feb) [Prev: 0.6]

13:00 GMT - EU: Consumer Sentiment (Apr A) [Prev: -7.2]

14:00 GMT - US: New Home Sales (Mar) 4cast: 645k (Mkt: 650 Prev: 667)

EVENTS & AUCTIONS

- UK: Parliament Returns from Easter Recess

- 04:35 GMT - JP: 2yr Bills Auction

- 10:30 GMT - EU: ECB Main Refinancing Operation Result

- 16:30 GMT - US: 52wk Bills Auction

- 18:00 GMT - US: 2yr Notes Auction


Forex - Asia Open - Overnight Highlights


 23:27 (GMT) 22 Apr

 [Forex Highlights]

Asia Overnight Highlights - 23 April 2019

ASIA OUTLOOK

On a subdued Easter Monday gains in oil price as the US stated it would eliminate waivers on purchases of Iranian oil the main story, giving a modest lift to the CAD. Elsewhere EUR/USD corrected higher but Cable remained weak.

Majors FX Highlights

The Bloomberg dollar spot index was little changed on Monday, and traded quietly around 97.400 before dipping slightly to 97.300 in the NY session. Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675. USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

Majors Data Highlights

US Mar existing home sales at 5.21m are fairly close to the average of Feb's strong 5.48m and Jan's weak 4.93m. While a little above Q4's average they are close to levels seen in Sep, Oct, and Nov. The picture is of a housing market stabilizing, perhaps modestly improving, after trending lower through most of 2018.

New home sales are due in the US, expected to correct lower by 3.3% to 645k. Europe remains quiet but UK MPs return to the parliament. This week therefore is one in which a new parliamentary process could begin in an attempt to find a consensus. This could by either through new indicative votes or the government introducing the bill, which MPs could amend, either to add a confirmatory referendum or soft Brexit options such as a customs union.

Emerging Asia FX Highlights

USD/Asians traded mostly higher earlier on Monday before retreating slightly and entering consolidation. USD/CNY 1Y NDFs shot up again to 6.7600 handle in late Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. USD/SGD was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. USD/IDR 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. USD/INR 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure.

Emerging Asia Data Highlights

Singapore's March CPI will be on focus today - the first one after the MAS decided to keep policy on hold.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar existing home sales -4.9% to 5.21m vs 5.30m exp.

- VIX index: 12.42 (+2.73%)

- Gold Spot: $1,275.18/oz (+0.02%)

- ICE Brent front contract: $74.04 (+$2.07)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.92 (+0.42%)

- 10y UST: 2.589% (+3bp) (Asia morning)

- DJI: 26,511.05 (-0.18%); S&P: 2,907.97 (+0.10%); Nasdaq: 8,015.27 (+0.22%)

ASIA NEWS

China: China will use "high-level" opening up measures to push for reforms, Xinhua reports, citing a meeting of the Central Committee for Financial and Economic Affairs chaired by President Xi Jinping. - BBG

Indonesia: Indonesia's 2019 budget deficit at 0.63% of GDP as of March compared to 0.58% in same period last year, according to statement from Finance Ministry. - BBG

India: Indian state refiners have firmed up oil supplies from alternate sources to replace Iran oil volumes for next month as contingency plan for non-renewal of U.S. waivers, a govt official says. - BBG

CURRENCIES

Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675.

USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

BONDS

USTs predictably quiet given the European holiday although the o/n move higher in yields does leak out further into the US session as oil bounce takes root. Lift in oil on the US Iran waiver end story encouraged USTs to trim back Friday's short covering burst. Existing homes data drops back broadly as expected, shrugged off. Curve a touch steeper despite the pending short end supply. 2s +0.6bps @ 2.39%, 5s +1.7bps @ 2.39%, 10s +3.1bps @ 2.59%, 30s +3.3bps @ 2.99%.

Agency Spreads: Freddie/Fannie 5s -0.7/-0.8 bps, 10s 0.0/-0.7 bps.

Swap Spreads: 2s -1.18bps, 5s -0.60bps, 10s -0.69bps.

EQUITIES

Equities saw a quiet day with strength in energy as oil prices increased balanced by modest losses in most sectors. A fairly light earnings calendar had little impact. Haliburton was subdued after announcing its results.

ASIA CURRENCIES

USD/CNY: 1Y NDFs shot up again to 6.7600 handle IN LATE Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. On Monday, PBoC fixed mid-point at 6.7035 vs. previous close of 6.7049. Onshore spot traded with an upside bias as well, and inched up to 6.7150 highs on Monday. We expect pair to eye the 6.7233 resistance next.

USD/CNH: Pair peaked at 6.7192 earlier on Monday before trading horizontally around 6.7150 again in the overnight session. China's politburo reiterated the need for a prudent monetary policy and remained cautiously optimistic, despite stronger than expected Q1 economic growth. We expect pair to eye the 6.7300 handle. If broken, will turn our attention to the 6.7500 resistance next.

USD/SGD: Pair was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. Focus for today will be on Singapore's March CPI. We expect headline inflation at 0.6% y/y in March (0.5% in February) and core inflation at 1.5% (1.5% prior). Pair is likely to eye the 1.3581 resistance next, before seeing a reversal to the 1.3510 support.

USD/IDR: 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. Onshore spot traded with a slight upside bias after the long weekend and opening flat at 14045. Pair inched up to over 1-week highs of 14096 as opponent Prabowo challenged Jokowi's victory in the presidential elections, which keeps threats of protests still alive. Oil prices were also on an uptrend, weighing on the rupiah but upside for USD/IDR possibly seemed capped and pair dropped back to 14080 into the close. We expect 13890 support to stand firm for now unless a Jokowi victory is confirmed, and a firmer break above 14090 remains likely.

USD/INR: 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure. Onshore spot gapped higher to open at 69.7500 after the long weekend vs. last close of 69.3550 as oil prices rallied on reports that US could end Iran sanction waivers. Pair traded to fresh 6-week highs of 69.8700 in early trading, before retreating to sub-69.7000 levels in the afternoon. Risk of break to the 70 handle has arisen due to oil price gains amid the election uncertainties, but we do not see much upside above it as the RBI has kept the door open for more rate cuts.

DATA RELEASES DUE TODAY

00:30 GMT - JP: Nikkei PMI Mfg (Apr P) index (Mkt: Prev: 49.2)

05:00 GMT - SG: Core CPI (Mar) 4cast: 1.5% y/y (Mkt: 1.7 Prev: 1.5)

05:00 GMT - SG: CPI (Mar) 4cast: 0.6% y/y (Mkt: 0 Prev: 0.5)

08:00 GMT - TW: Industrial Output (Mar) % y/y (Mkt: -1.5 Prev: -1.8)

08:30 GMT - HK: CPI (Mar) % y/y (Mkt: 2.2 Prev: 2.1)

12:30 GMT - CA: Wholesale Sales (Feb) [Prev: 0.6]

13:00 GMT - US: FHFA House Price Index (Feb) [Prev: 0.6]

13:00 GMT - EU: Consumer Sentiment (Apr A) [Prev: -7.2]

14:00 GMT - US: New Home Sales (Mar) 4cast: 645k (Mkt: 650 Prev: 667)

EVENTS & AUCTIONS

- UK: Parliament Returns from Easter Recess

- 04:35 GMT - JP: 2yr Bills Auction

- 10:30 GMT - EU: ECB Main Refinancing Operation Result

- 16:30 GMT - US: 52wk Bills Auction

- 18:00 GMT - US: 2yr Notes Auction


Forex - Asia Open - Overnight Highlights


 23:27 (GMT) 22 Apr

 [Forex Highlights]

Asia Overnight Highlights - 23 April 2019

ASIA OUTLOOK

On a subdued Easter Monday gains in oil price as the US stated it would eliminate waivers on purchases of Iranian oil the main story, giving a modest lift to the CAD. Elsewhere EUR/USD corrected higher but Cable remained weak.

Majors FX Highlights

The Bloomberg dollar spot index was little changed on Monday, and traded quietly around 97.400 before dipping slightly to 97.300 in the NY session. Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675. USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

Majors Data Highlights

US Mar existing home sales at 5.21m are fairly close to the average of Feb's strong 5.48m and Jan's weak 4.93m. While a little above Q4's average they are close to levels seen in Sep, Oct, and Nov. The picture is of a housing market stabilizing, perhaps modestly improving, after trending lower through most of 2018.

New home sales are due in the US, expected to correct lower by 3.3% to 645k. Europe remains quiet but UK MPs return to the parliament. This week therefore is one in which a new parliamentary process could begin in an attempt to find a consensus. This could by either through new indicative votes or the government introducing the bill, which MPs could amend, either to add a confirmatory referendum or soft Brexit options such as a customs union.

Emerging Asia FX Highlights

USD/Asians traded mostly higher earlier on Monday before retreating slightly and entering consolidation. USD/CNY 1Y NDFs shot up again to 6.7600 handle in late Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. USD/SGD was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. USD/IDR 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. USD/INR 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure.

Emerging Asia Data Highlights

Singapore's March CPI will be on focus today - the first one after the MAS decided to keep policy on hold.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar existing home sales -4.9% to 5.21m vs 5.30m exp.

- VIX index: 12.42 (+2.73%)

- Gold Spot: $1,275.18/oz (+0.02%)

- ICE Brent front contract: $74.04 (+$2.07)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.92 (+0.42%)

- 10y UST: 2.589% (+3bp) (Asia morning)

- DJI: 26,511.05 (-0.18%); S&P: 2,907.97 (+0.10%); Nasdaq: 8,015.27 (+0.22%)

ASIA NEWS

China: China will use "high-level" opening up measures to push for reforms, Xinhua reports, citing a meeting of the Central Committee for Financial and Economic Affairs chaired by President Xi Jinping. - BBG

Indonesia: Indonesia's 2019 budget deficit at 0.63% of GDP as of March compared to 0.58% in same period last year, according to statement from Finance Ministry. - BBG

India: Indian state refiners have firmed up oil supplies from alternate sources to replace Iran oil volumes for next month as contingency plan for non-renewal of U.S. waivers, a govt official says. - BBG

CURRENCIES

Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675.

USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

BONDS

USTs predictably quiet given the European holiday although the o/n move higher in yields does leak out further into the US session as oil bounce takes root. Lift in oil on the US Iran waiver end story encouraged USTs to trim back Friday's short covering burst. Existing homes data drops back broadly as expected, shrugged off. Curve a touch steeper despite the pending short end supply. 2s +0.6bps @ 2.39%, 5s +1.7bps @ 2.39%, 10s +3.1bps @ 2.59%, 30s +3.3bps @ 2.99%.

Agency Spreads: Freddie/Fannie 5s -0.7/-0.8 bps, 10s 0.0/-0.7 bps.

Swap Spreads: 2s -1.18bps, 5s -0.60bps, 10s -0.69bps.

EQUITIES

Equities saw a quiet day with strength in energy as oil prices increased balanced by modest losses in most sectors. A fairly light earnings calendar had little impact. Haliburton was subdued after announcing its results.

ASIA CURRENCIES

USD/CNY: 1Y NDFs shot up again to 6.7600 handle IN LATE Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. On Monday, PBoC fixed mid-point at 6.7035 vs. previous close of 6.7049. Onshore spot traded with an upside bias as well, and inched up to 6.7150 highs on Monday. We expect pair to eye the 6.7233 resistance next.

USD/CNH: Pair peaked at 6.7192 earlier on Monday before trading horizontally around 6.7150 again in the overnight session. China's politburo reiterated the need for a prudent monetary policy and remained cautiously optimistic, despite stronger than expected Q1 economic growth. We expect pair to eye the 6.7300 handle. If broken, will turn our attention to the 6.7500 resistance next.

USD/SGD: Pair was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. Focus for today will be on Singapore's March CPI. We expect headline inflation at 0.6% y/y in March (0.5% in February) and core inflation at 1.5% (1.5% prior). Pair is likely to eye the 1.3581 resistance next, before seeing a reversal to the 1.3510 support.

USD/IDR: 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. Onshore spot traded with a slight upside bias after the long weekend and opening flat at 14045. Pair inched up to over 1-week highs of 14096 as opponent Prabowo challenged Jokowi's victory in the presidential elections, which keeps threats of protests still alive. Oil prices were also on an uptrend, weighing on the rupiah but upside for USD/IDR possibly seemed capped and pair dropped back to 14080 into the close. We expect 13890 support to stand firm for now unless a Jokowi victory is confirmed, and a firmer break above 14090 remains likely.

USD/INR: 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure. Onshore spot gapped higher to open at 69.7500 after the long weekend vs. last close of 69.3550 as oil prices rallied on reports that US could end Iran sanction waivers. Pair traded to fresh 6-week highs of 69.8700 in early trading, before retreating to sub-69.7000 levels in the afternoon. Risk of break to the 70 handle has arisen due to oil price gains amid the election uncertainties, but we do not see much upside above it as the RBI has kept the door open for more rate cuts.

DATA RELEASES DUE TODAY

00:30 GMT - JP: Nikkei PMI Mfg (Apr P) index (Mkt: Prev: 49.2)

05:00 GMT - SG: Core CPI (Mar) 4cast: 1.5% y/y (Mkt: 1.7 Prev: 1.5)

05:00 GMT - SG: CPI (Mar) 4cast: 0.6% y/y (Mkt: 0 Prev: 0.5)

08:00 GMT - TW: Industrial Output (Mar) % y/y (Mkt: -1.5 Prev: -1.8)

08:30 GMT - HK: CPI (Mar) % y/y (Mkt: 2.2 Prev: 2.1)

12:30 GMT - CA: Wholesale Sales (Feb) [Prev: 0.6]

13:00 GMT - US: FHFA House Price Index (Feb) [Prev: 0.6]

13:00 GMT - EU: Consumer Sentiment (Apr A) [Prev: -7.2]

14:00 GMT - US: New Home Sales (Mar) 4cast: 645k (Mkt: 650 Prev: 667)

EVENTS & AUCTIONS

- UK: Parliament Returns from Easter Recess

- 04:35 GMT - JP: 2yr Bills Auction

- 10:30 GMT - EU: ECB Main Refinancing Operation Result

- 16:30 GMT - US: 52wk Bills Auction

- 18:00 GMT - US: 2yr Notes Auction


Forex - Asia Open - Overnight Highlights


 23:27 (GMT) 22 Apr

 [Forex Highlights]

Asia Overnight Highlights - 23 April 2019

ASIA OUTLOOK

On a subdued Easter Monday gains in oil price as the US stated it would eliminate waivers on purchases of Iranian oil the main story, giving a modest lift to the CAD. Elsewhere EUR/USD corrected higher but Cable remained weak.

Majors FX Highlights

The Bloomberg dollar spot index was little changed on Monday, and traded quietly around 97.400 before dipping slightly to 97.300 in the NY session. Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675. USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

Majors Data Highlights

US Mar existing home sales at 5.21m are fairly close to the average of Feb's strong 5.48m and Jan's weak 4.93m. While a little above Q4's average they are close to levels seen in Sep, Oct, and Nov. The picture is of a housing market stabilizing, perhaps modestly improving, after trending lower through most of 2018.

New home sales are due in the US, expected to correct lower by 3.3% to 645k. Europe remains quiet but UK MPs return to the parliament. This week therefore is one in which a new parliamentary process could begin in an attempt to find a consensus. This could by either through new indicative votes or the government introducing the bill, which MPs could amend, either to add a confirmatory referendum or soft Brexit options such as a customs union.

Emerging Asia FX Highlights

USD/Asians traded mostly higher earlier on Monday before retreating slightly and entering consolidation. USD/CNY 1Y NDFs shot up again to 6.7600 handle in late Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. USD/SGD was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. USD/IDR 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. USD/INR 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure.

Emerging Asia Data Highlights

Singapore's March CPI will be on focus today - the first one after the MAS decided to keep policy on hold.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar existing home sales -4.9% to 5.21m vs 5.30m exp.

- VIX index: 12.42 (+2.73%)

- Gold Spot: $1,275.18/oz (+0.02%)

- ICE Brent front contract: $74.04 (+$2.07)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.92 (+0.42%)

- 10y UST: 2.589% (+3bp) (Asia morning)

- DJI: 26,511.05 (-0.18%); S&P: 2,907.97 (+0.10%); Nasdaq: 8,015.27 (+0.22%)

ASIA NEWS

China: China will use "high-level" opening up measures to push for reforms, Xinhua reports, citing a meeting of the Central Committee for Financial and Economic Affairs chaired by President Xi Jinping. - BBG

Indonesia: Indonesia's 2019 budget deficit at 0.63% of GDP as of March compared to 0.58% in same period last year, according to statement from Finance Ministry. - BBG

India: Indian state refiners have firmed up oil supplies from alternate sources to replace Iran oil volumes for next month as contingency plan for non-renewal of U.S. waivers, a govt official says. - BBG

CURRENCIES

Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675.

USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

BONDS

USTs predictably quiet given the European holiday although the o/n move higher in yields does leak out further into the US session as oil bounce takes root. Lift in oil on the US Iran waiver end story encouraged USTs to trim back Friday's short covering burst. Existing homes data drops back broadly as expected, shrugged off. Curve a touch steeper despite the pending short end supply. 2s +0.6bps @ 2.39%, 5s +1.7bps @ 2.39%, 10s +3.1bps @ 2.59%, 30s +3.3bps @ 2.99%.

Agency Spreads: Freddie/Fannie 5s -0.7/-0.8 bps, 10s 0.0/-0.7 bps.

Swap Spreads: 2s -1.18bps, 5s -0.60bps, 10s -0.69bps.

EQUITIES

Equities saw a quiet day with strength in energy as oil prices increased balanced by modest losses in most sectors. A fairly light earnings calendar had little impact. Haliburton was subdued after announcing its results.

ASIA CURRENCIES

USD/CNY: 1Y NDFs shot up again to 6.7600 handle IN LATE Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. On Monday, PBoC fixed mid-point at 6.7035 vs. previous close of 6.7049. Onshore spot traded with an upside bias as well, and inched up to 6.7150 highs on Monday. We expect pair to eye the 6.7233 resistance next.

USD/CNH: Pair peaked at 6.7192 earlier on Monday before trading horizontally around 6.7150 again in the overnight session. China's politburo reiterated the need for a prudent monetary policy and remained cautiously optimistic, despite stronger than expected Q1 economic growth. We expect pair to eye the 6.7300 handle. If broken, will turn our attention to the 6.7500 resistance next.

USD/SGD: Pair was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. Focus for today will be on Singapore's March CPI. We expect headline inflation at 0.6% y/y in March (0.5% in February) and core inflation at 1.5% (1.5% prior). Pair is likely to eye the 1.3581 resistance next, before seeing a reversal to the 1.3510 support.

USD/IDR: 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. Onshore spot traded with a slight upside bias after the long weekend and opening flat at 14045. Pair inched up to over 1-week highs of 14096 as opponent Prabowo challenged Jokowi's victory in the presidential elections, which keeps threats of protests still alive. Oil prices were also on an uptrend, weighing on the rupiah but upside for USD/IDR possibly seemed capped and pair dropped back to 14080 into the close. We expect 13890 support to stand firm for now unless a Jokowi victory is confirmed, and a firmer break above 14090 remains likely.

USD/INR: 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure. Onshore spot gapped higher to open at 69.7500 after the long weekend vs. last close of 69.3550 as oil prices rallied on reports that US could end Iran sanction waivers. Pair traded to fresh 6-week highs of 69.8700 in early trading, before retreating to sub-69.7000 levels in the afternoon. Risk of break to the 70 handle has arisen due to oil price gains amid the election uncertainties, but we do not see much upside above it as the RBI has kept the door open for more rate cuts.

DATA RELEASES DUE TODAY

00:30 GMT - JP: Nikkei PMI Mfg (Apr P) index (Mkt: Prev: 49.2)

05:00 GMT - SG: Core CPI (Mar) 4cast: 1.5% y/y (Mkt: 1.7 Prev: 1.5)

05:00 GMT - SG: CPI (Mar) 4cast: 0.6% y/y (Mkt: 0 Prev: 0.5)

08:00 GMT - TW: Industrial Output (Mar) % y/y (Mkt: -1.5 Prev: -1.8)

08:30 GMT - HK: CPI (Mar) % y/y (Mkt: 2.2 Prev: 2.1)

12:30 GMT - CA: Wholesale Sales (Feb) [Prev: 0.6]

13:00 GMT - US: FHFA House Price Index (Feb) [Prev: 0.6]

13:00 GMT - EU: Consumer Sentiment (Apr A) [Prev: -7.2]

14:00 GMT - US: New Home Sales (Mar) 4cast: 645k (Mkt: 650 Prev: 667)

EVENTS & AUCTIONS

- UK: Parliament Returns from Easter Recess

- 04:35 GMT - JP: 2yr Bills Auction

- 10:30 GMT - EU: ECB Main Refinancing Operation Result

- 16:30 GMT - US: 52wk Bills Auction

- 18:00 GMT - US: 2yr Notes Auction


Forex - Asia Open - Overnight Highlights


 23:27 (GMT) 22 Apr

 [Forex Highlights]

Asia Overnight Highlights - 23 April 2019

ASIA OUTLOOK

On a subdued Easter Monday gains in oil price as the US stated it would eliminate waivers on purchases of Iranian oil the main story, giving a modest lift to the CAD. Elsewhere EUR/USD corrected higher but Cable remained weak.

Majors FX Highlights

The Bloomberg dollar spot index was little changed on Monday, and traded quietly around 97.400 before dipping slightly to 97.300 in the NY session. Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675. USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

Majors Data Highlights

US Mar existing home sales at 5.21m are fairly close to the average of Feb's strong 5.48m and Jan's weak 4.93m. While a little above Q4's average they are close to levels seen in Sep, Oct, and Nov. The picture is of a housing market stabilizing, perhaps modestly improving, after trending lower through most of 2018.

New home sales are due in the US, expected to correct lower by 3.3% to 645k. Europe remains quiet but UK MPs return to the parliament. This week therefore is one in which a new parliamentary process could begin in an attempt to find a consensus. This could by either through new indicative votes or the government introducing the bill, which MPs could amend, either to add a confirmatory referendum or soft Brexit options such as a customs union.

Emerging Asia FX Highlights

USD/Asians traded mostly higher earlier on Monday before retreating slightly and entering consolidation. USD/CNY 1Y NDFs shot up again to 6.7600 handle in late Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. USD/SGD was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. USD/IDR 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. USD/INR 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure.

Emerging Asia Data Highlights

Singapore's March CPI will be on focus today - the first one after the MAS decided to keep policy on hold.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar existing home sales -4.9% to 5.21m vs 5.30m exp.

- VIX index: 12.42 (+2.73%)

- Gold Spot: $1,275.18/oz (+0.02%)

- ICE Brent front contract: $74.04 (+$2.07)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.92 (+0.42%)

- 10y UST: 2.589% (+3bp) (Asia morning)

- DJI: 26,511.05 (-0.18%); S&P: 2,907.97 (+0.10%); Nasdaq: 8,015.27 (+0.22%)

ASIA NEWS

China: China will use "high-level" opening up measures to push for reforms, Xinhua reports, citing a meeting of the Central Committee for Financial and Economic Affairs chaired by President Xi Jinping. - BBG

Indonesia: Indonesia's 2019 budget deficit at 0.63% of GDP as of March compared to 0.58% in same period last year, according to statement from Finance Ministry. - BBG

India: Indian state refiners have firmed up oil supplies from alternate sources to replace Iran oil volumes for next month as contingency plan for non-renewal of U.S. waivers, a govt official says. - BBG

CURRENCIES

Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675.

USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

BONDS

USTs predictably quiet given the European holiday although the o/n move higher in yields does leak out further into the US session as oil bounce takes root. Lift in oil on the US Iran waiver end story encouraged USTs to trim back Friday's short covering burst. Existing homes data drops back broadly as expected, shrugged off. Curve a touch steeper despite the pending short end supply. 2s +0.6bps @ 2.39%, 5s +1.7bps @ 2.39%, 10s +3.1bps @ 2.59%, 30s +3.3bps @ 2.99%.

Agency Spreads: Freddie/Fannie 5s -0.7/-0.8 bps, 10s 0.0/-0.7 bps.

Swap Spreads: 2s -1.18bps, 5s -0.60bps, 10s -0.69bps.

EQUITIES

Equities saw a quiet day with strength in energy as oil prices increased balanced by modest losses in most sectors. A fairly light earnings calendar had little impact. Haliburton was subdued after announcing its results.

ASIA CURRENCIES

USD/CNY: 1Y NDFs shot up again to 6.7600 handle IN LATE Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. On Monday, PBoC fixed mid-point at 6.7035 vs. previous close of 6.7049. Onshore spot traded with an upside bias as well, and inched up to 6.7150 highs on Monday. We expect pair to eye the 6.7233 resistance next.

USD/CNH: Pair peaked at 6.7192 earlier on Monday before trading horizontally around 6.7150 again in the overnight session. China's politburo reiterated the need for a prudent monetary policy and remained cautiously optimistic, despite stronger than expected Q1 economic growth. We expect pair to eye the 6.7300 handle. If broken, will turn our attention to the 6.7500 resistance next.

USD/SGD: Pair was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. Focus for today will be on Singapore's March CPI. We expect headline inflation at 0.6% y/y in March (0.5% in February) and core inflation at 1.5% (1.5% prior). Pair is likely to eye the 1.3581 resistance next, before seeing a reversal to the 1.3510 support.

USD/IDR: 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. Onshore spot traded with a slight upside bias after the long weekend and opening flat at 14045. Pair inched up to over 1-week highs of 14096 as opponent Prabowo challenged Jokowi's victory in the presidential elections, which keeps threats of protests still alive. Oil prices were also on an uptrend, weighing on the rupiah but upside for USD/IDR possibly seemed capped and pair dropped back to 14080 into the close. We expect 13890 support to stand firm for now unless a Jokowi victory is confirmed, and a firmer break above 14090 remains likely.

USD/INR: 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure. Onshore spot gapped higher to open at 69.7500 after the long weekend vs. last close of 69.3550 as oil prices rallied on reports that US could end Iran sanction waivers. Pair traded to fresh 6-week highs of 69.8700 in early trading, before retreating to sub-69.7000 levels in the afternoon. Risk of break to the 70 handle has arisen due to oil price gains amid the election uncertainties, but we do not see much upside above it as the RBI has kept the door open for more rate cuts.

DATA RELEASES DUE TODAY

00:30 GMT - JP: Nikkei PMI Mfg (Apr P) index (Mkt: Prev: 49.2)

05:00 GMT - SG: Core CPI (Mar) 4cast: 1.5% y/y (Mkt: 1.7 Prev: 1.5)

05:00 GMT - SG: CPI (Mar) 4cast: 0.6% y/y (Mkt: 0 Prev: 0.5)

08:00 GMT - TW: Industrial Output (Mar) % y/y (Mkt: -1.5 Prev: -1.8)

08:30 GMT - HK: CPI (Mar) % y/y (Mkt: 2.2 Prev: 2.1)

12:30 GMT - CA: Wholesale Sales (Feb) [Prev: 0.6]

13:00 GMT - US: FHFA House Price Index (Feb) [Prev: 0.6]

13:00 GMT - EU: Consumer Sentiment (Apr A) [Prev: -7.2]

14:00 GMT - US: New Home Sales (Mar) 4cast: 645k (Mkt: 650 Prev: 667)

EVENTS & AUCTIONS

- UK: Parliament Returns from Easter Recess

- 04:35 GMT - JP: 2yr Bills Auction

- 10:30 GMT - EU: ECB Main Refinancing Operation Result

- 16:30 GMT - US: 52wk Bills Auction

- 18:00 GMT - US: 2yr Notes Auction


Forex - Asia Open - Overnight Highlights


 23:27 (GMT) 22 Apr

 [Forex Highlights]

Asia Overnight Highlights - 23 April 2019

ASIA OUTLOOK

On a subdued Easter Monday gains in oil price as the US stated it would eliminate waivers on purchases of Iranian oil the main story, giving a modest lift to the CAD. Elsewhere EUR/USD corrected higher but Cable remained weak.

Majors FX Highlights

The Bloomberg dollar spot index was little changed on Monday, and traded quietly around 97.400 before dipping slightly to 97.300 in the NY session. Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675. USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

Majors Data Highlights

US Mar existing home sales at 5.21m are fairly close to the average of Feb's strong 5.48m and Jan's weak 4.93m. While a little above Q4's average they are close to levels seen in Sep, Oct, and Nov. The picture is of a housing market stabilizing, perhaps modestly improving, after trending lower through most of 2018.

New home sales are due in the US, expected to correct lower by 3.3% to 645k. Europe remains quiet but UK MPs return to the parliament. This week therefore is one in which a new parliamentary process could begin in an attempt to find a consensus. This could by either through new indicative votes or the government introducing the bill, which MPs could amend, either to add a confirmatory referendum or soft Brexit options such as a customs union.

Emerging Asia FX Highlights

USD/Asians traded mostly higher earlier on Monday before retreating slightly and entering consolidation. USD/CNY 1Y NDFs shot up again to 6.7600 handle in late Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. USD/SGD was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. USD/IDR 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. USD/INR 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure.

Emerging Asia Data Highlights

Singapore's March CPI will be on focus today - the first one after the MAS decided to keep policy on hold.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar existing home sales -4.9% to 5.21m vs 5.30m exp.

- VIX index: 12.42 (+2.73%)

- Gold Spot: $1,275.18/oz (+0.02%)

- ICE Brent front contract: $74.04 (+$2.07)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.92 (+0.42%)

- 10y UST: 2.589% (+3bp) (Asia morning)

- DJI: 26,511.05 (-0.18%); S&P: 2,907.97 (+0.10%); Nasdaq: 8,015.27 (+0.22%)

ASIA NEWS

China: China will use "high-level" opening up measures to push for reforms, Xinhua reports, citing a meeting of the Central Committee for Financial and Economic Affairs chaired by President Xi Jinping. - BBG

Indonesia: Indonesia's 2019 budget deficit at 0.63% of GDP as of March compared to 0.58% in same period last year, according to statement from Finance Ministry. - BBG

India: Indian state refiners have firmed up oil supplies from alternate sources to replace Iran oil volumes for next month as contingency plan for non-renewal of U.S. waivers, a govt official says. - BBG

CURRENCIES

Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675.

USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

BONDS

USTs predictably quiet given the European holiday although the o/n move higher in yields does leak out further into the US session as oil bounce takes root. Lift in oil on the US Iran waiver end story encouraged USTs to trim back Friday's short covering burst. Existing homes data drops back broadly as expected, shrugged off. Curve a touch steeper despite the pending short end supply. 2s +0.6bps @ 2.39%, 5s +1.7bps @ 2.39%, 10s +3.1bps @ 2.59%, 30s +3.3bps @ 2.99%.

Agency Spreads: Freddie/Fannie 5s -0.7/-0.8 bps, 10s 0.0/-0.7 bps.

Swap Spreads: 2s -1.18bps, 5s -0.60bps, 10s -0.69bps.

EQUITIES

Equities saw a quiet day with strength in energy as oil prices increased balanced by modest losses in most sectors. A fairly light earnings calendar had little impact. Haliburton was subdued after announcing its results.

ASIA CURRENCIES

USD/CNY: 1Y NDFs shot up again to 6.7600 handle IN LATE Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. On Monday, PBoC fixed mid-point at 6.7035 vs. previous close of 6.7049. Onshore spot traded with an upside bias as well, and inched up to 6.7150 highs on Monday. We expect pair to eye the 6.7233 resistance next.

USD/CNH: Pair peaked at 6.7192 earlier on Monday before trading horizontally around 6.7150 again in the overnight session. China's politburo reiterated the need for a prudent monetary policy and remained cautiously optimistic, despite stronger than expected Q1 economic growth. We expect pair to eye the 6.7300 handle. If broken, will turn our attention to the 6.7500 resistance next.

USD/SGD: Pair was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. Focus for today will be on Singapore's March CPI. We expect headline inflation at 0.6% y/y in March (0.5% in February) and core inflation at 1.5% (1.5% prior). Pair is likely to eye the 1.3581 resistance next, before seeing a reversal to the 1.3510 support.

USD/IDR: 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. Onshore spot traded with a slight upside bias after the long weekend and opening flat at 14045. Pair inched up to over 1-week highs of 14096 as opponent Prabowo challenged Jokowi's victory in the presidential elections, which keeps threats of protests still alive. Oil prices were also on an uptrend, weighing on the rupiah but upside for USD/IDR possibly seemed capped and pair dropped back to 14080 into the close. We expect 13890 support to stand firm for now unless a Jokowi victory is confirmed, and a firmer break above 14090 remains likely.

USD/INR: 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure. Onshore spot gapped higher to open at 69.7500 after the long weekend vs. last close of 69.3550 as oil prices rallied on reports that US could end Iran sanction waivers. Pair traded to fresh 6-week highs of 69.8700 in early trading, before retreating to sub-69.7000 levels in the afternoon. Risk of break to the 70 handle has arisen due to oil price gains amid the election uncertainties, but we do not see much upside above it as the RBI has kept the door open for more rate cuts.

DATA RELEASES DUE TODAY

00:30 GMT - JP: Nikkei PMI Mfg (Apr P) index (Mkt: Prev: 49.2)

05:00 GMT - SG: Core CPI (Mar) 4cast: 1.5% y/y (Mkt: 1.7 Prev: 1.5)

05:00 GMT - SG: CPI (Mar) 4cast: 0.6% y/y (Mkt: 0 Prev: 0.5)

08:00 GMT - TW: Industrial Output (Mar) % y/y (Mkt: -1.5 Prev: -1.8)

08:30 GMT - HK: CPI (Mar) % y/y (Mkt: 2.2 Prev: 2.1)

12:30 GMT - CA: Wholesale Sales (Feb) [Prev: 0.6]

13:00 GMT - US: FHFA House Price Index (Feb) [Prev: 0.6]

13:00 GMT - EU: Consumer Sentiment (Apr A) [Prev: -7.2]

14:00 GMT - US: New Home Sales (Mar) 4cast: 645k (Mkt: 650 Prev: 667)

EVENTS & AUCTIONS

- UK: Parliament Returns from Easter Recess

- 04:35 GMT - JP: 2yr Bills Auction

- 10:30 GMT - EU: ECB Main Refinancing Operation Result

- 16:30 GMT - US: 52wk Bills Auction

- 18:00 GMT - US: 2yr Notes Auction


Forex - Asia Open - Overnight Highlights


 23:27 (GMT) 22 Apr

 [Forex Highlights]

Asia Overnight Highlights - 23 April 2019

ASIA OUTLOOK

On a subdued Easter Monday gains in oil price as the US stated it would eliminate waivers on purchases of Iranian oil the main story, giving a modest lift to the CAD. Elsewhere EUR/USD corrected higher but Cable remained weak.

Majors FX Highlights

The Bloomberg dollar spot index was little changed on Monday, and traded quietly around 97.400 before dipping slightly to 97.300 in the NY session. Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675. USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

Majors Data Highlights

US Mar existing home sales at 5.21m are fairly close to the average of Feb's strong 5.48m and Jan's weak 4.93m. While a little above Q4's average they are close to levels seen in Sep, Oct, and Nov. The picture is of a housing market stabilizing, perhaps modestly improving, after trending lower through most of 2018.

New home sales are due in the US, expected to correct lower by 3.3% to 645k. Europe remains quiet but UK MPs return to the parliament. This week therefore is one in which a new parliamentary process could begin in an attempt to find a consensus. This could by either through new indicative votes or the government introducing the bill, which MPs could amend, either to add a confirmatory referendum or soft Brexit options such as a customs union.

Emerging Asia FX Highlights

USD/Asians traded mostly higher earlier on Monday before retreating slightly and entering consolidation. USD/CNY 1Y NDFs shot up again to 6.7600 handle in late Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. USD/SGD was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. USD/IDR 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. USD/INR 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure.

Emerging Asia Data Highlights

Singapore's March CPI will be on focus today - the first one after the MAS decided to keep policy on hold.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar existing home sales -4.9% to 5.21m vs 5.30m exp.

- VIX index: 12.42 (+2.73%)

- Gold Spot: $1,275.18/oz (+0.02%)

- ICE Brent front contract: $74.04 (+$2.07)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.92 (+0.42%)

- 10y UST: 2.589% (+3bp) (Asia morning)

- DJI: 26,511.05 (-0.18%); S&P: 2,907.97 (+0.10%); Nasdaq: 8,015.27 (+0.22%)

ASIA NEWS

China: China will use "high-level" opening up measures to push for reforms, Xinhua reports, citing a meeting of the Central Committee for Financial and Economic Affairs chaired by President Xi Jinping. - BBG

Indonesia: Indonesia's 2019 budget deficit at 0.63% of GDP as of March compared to 0.58% in same period last year, according to statement from Finance Ministry. - BBG

India: Indian state refiners have firmed up oil supplies from alternate sources to replace Iran oil volumes for next month as contingency plan for non-renewal of U.S. waivers, a govt official says. - BBG

CURRENCIES

Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675.

USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

BONDS

USTs predictably quiet given the European holiday although the o/n move higher in yields does leak out further into the US session as oil bounce takes root. Lift in oil on the US Iran waiver end story encouraged USTs to trim back Friday's short covering burst. Existing homes data drops back broadly as expected, shrugged off. Curve a touch steeper despite the pending short end supply. 2s +0.6bps @ 2.39%, 5s +1.7bps @ 2.39%, 10s +3.1bps @ 2.59%, 30s +3.3bps @ 2.99%.

Agency Spreads: Freddie/Fannie 5s -0.7/-0.8 bps, 10s 0.0/-0.7 bps.

Swap Spreads: 2s -1.18bps, 5s -0.60bps, 10s -0.69bps.

EQUITIES

Equities saw a quiet day with strength in energy as oil prices increased balanced by modest losses in most sectors. A fairly light earnings calendar had little impact. Haliburton was subdued after announcing its results.

ASIA CURRENCIES

USD/CNY: 1Y NDFs shot up again to 6.7600 handle IN LATE Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. On Monday, PBoC fixed mid-point at 6.7035 vs. previous close of 6.7049. Onshore spot traded with an upside bias as well, and inched up to 6.7150 highs on Monday. We expect pair to eye the 6.7233 resistance next.

USD/CNH: Pair peaked at 6.7192 earlier on Monday before trading horizontally around 6.7150 again in the overnight session. China's politburo reiterated the need for a prudent monetary policy and remained cautiously optimistic, despite stronger than expected Q1 economic growth. We expect pair to eye the 6.7300 handle. If broken, will turn our attention to the 6.7500 resistance next.

USD/SGD: Pair was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. Focus for today will be on Singapore's March CPI. We expect headline inflation at 0.6% y/y in March (0.5% in February) and core inflation at 1.5% (1.5% prior). Pair is likely to eye the 1.3581 resistance next, before seeing a reversal to the 1.3510 support.

USD/IDR: 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. Onshore spot traded with a slight upside bias after the long weekend and opening flat at 14045. Pair inched up to over 1-week highs of 14096 as opponent Prabowo challenged Jokowi's victory in the presidential elections, which keeps threats of protests still alive. Oil prices were also on an uptrend, weighing on the rupiah but upside for USD/IDR possibly seemed capped and pair dropped back to 14080 into the close. We expect 13890 support to stand firm for now unless a Jokowi victory is confirmed, and a firmer break above 14090 remains likely.

USD/INR: 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure. Onshore spot gapped higher to open at 69.7500 after the long weekend vs. last close of 69.3550 as oil prices rallied on reports that US could end Iran sanction waivers. Pair traded to fresh 6-week highs of 69.8700 in early trading, before retreating to sub-69.7000 levels in the afternoon. Risk of break to the 70 handle has arisen due to oil price gains amid the election uncertainties, but we do not see much upside above it as the RBI has kept the door open for more rate cuts.

DATA RELEASES DUE TODAY

00:30 GMT - JP: Nikkei PMI Mfg (Apr P) index (Mkt: Prev: 49.2)

05:00 GMT - SG: Core CPI (Mar) 4cast: 1.5% y/y (Mkt: 1.7 Prev: 1.5)

05:00 GMT - SG: CPI (Mar) 4cast: 0.6% y/y (Mkt: 0 Prev: 0.5)

08:00 GMT - TW: Industrial Output (Mar) % y/y (Mkt: -1.5 Prev: -1.8)

08:30 GMT - HK: CPI (Mar) % y/y (Mkt: 2.2 Prev: 2.1)

12:30 GMT - CA: Wholesale Sales (Feb) [Prev: 0.6]

13:00 GMT - US: FHFA House Price Index (Feb) [Prev: 0.6]

13:00 GMT - EU: Consumer Sentiment (Apr A) [Prev: -7.2]

14:00 GMT - US: New Home Sales (Mar) 4cast: 645k (Mkt: 650 Prev: 667)

EVENTS & AUCTIONS

- UK: Parliament Returns from Easter Recess

- 04:35 GMT - JP: 2yr Bills Auction

- 10:30 GMT - EU: ECB Main Refinancing Operation Result

- 16:30 GMT - US: 52wk Bills Auction

- 18:00 GMT - US: 2yr Notes Auction


Forex - Asia Open - Overnight Highlights


 23:27 (GMT) 22 Apr

 [Forex Highlights]

Asia Overnight Highlights - 23 April 2019

ASIA OUTLOOK

On a subdued Easter Monday gains in oil price as the US stated it would eliminate waivers on purchases of Iranian oil the main story, giving a modest lift to the CAD. Elsewhere EUR/USD corrected higher but Cable remained weak.

Majors FX Highlights

The Bloomberg dollar spot index was little changed on Monday, and traded quietly around 97.400 before dipping slightly to 97.300 in the NY session. Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675. USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

Majors Data Highlights

US Mar existing home sales at 5.21m are fairly close to the average of Feb's strong 5.48m and Jan's weak 4.93m. While a little above Q4's average they are close to levels seen in Sep, Oct, and Nov. The picture is of a housing market stabilizing, perhaps modestly improving, after trending lower through most of 2018.

New home sales are due in the US, expected to correct lower by 3.3% to 645k. Europe remains quiet but UK MPs return to the parliament. This week therefore is one in which a new parliamentary process could begin in an attempt to find a consensus. This could by either through new indicative votes or the government introducing the bill, which MPs could amend, either to add a confirmatory referendum or soft Brexit options such as a customs union.

Emerging Asia FX Highlights

USD/Asians traded mostly higher earlier on Monday before retreating slightly and entering consolidation. USD/CNY 1Y NDFs shot up again to 6.7600 handle in late Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. USD/SGD was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. USD/IDR 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. USD/INR 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure.

Emerging Asia Data Highlights

Singapore's March CPI will be on focus today - the first one after the MAS decided to keep policy on hold.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar existing home sales -4.9% to 5.21m vs 5.30m exp.

- VIX index: 12.42 (+2.73%)

- Gold Spot: $1,275.18/oz (+0.02%)

- ICE Brent front contract: $74.04 (+$2.07)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.92 (+0.42%)

- 10y UST: 2.589% (+3bp) (Asia morning)

- DJI: 26,511.05 (-0.18%); S&P: 2,907.97 (+0.10%); Nasdaq: 8,015.27 (+0.22%)

ASIA NEWS

China: China will use "high-level" opening up measures to push for reforms, Xinhua reports, citing a meeting of the Central Committee for Financial and Economic Affairs chaired by President Xi Jinping. - BBG

Indonesia: Indonesia's 2019 budget deficit at 0.63% of GDP as of March compared to 0.58% in same period last year, according to statement from Finance Ministry. - BBG

India: Indian state refiners have firmed up oil supplies from alternate sources to replace Iran oil volumes for next month as contingency plan for non-renewal of U.S. waivers, a govt official says. - BBG

CURRENCIES

Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675.

USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

BONDS

USTs predictably quiet given the European holiday although the o/n move higher in yields does leak out further into the US session as oil bounce takes root. Lift in oil on the US Iran waiver end story encouraged USTs to trim back Friday's short covering burst. Existing homes data drops back broadly as expected, shrugged off. Curve a touch steeper despite the pending short end supply. 2s +0.6bps @ 2.39%, 5s +1.7bps @ 2.39%, 10s +3.1bps @ 2.59%, 30s +3.3bps @ 2.99%.

Agency Spreads: Freddie/Fannie 5s -0.7/-0.8 bps, 10s 0.0/-0.7 bps.

Swap Spreads: 2s -1.18bps, 5s -0.60bps, 10s -0.69bps.

EQUITIES

Equities saw a quiet day with strength in energy as oil prices increased balanced by modest losses in most sectors. A fairly light earnings calendar had little impact. Haliburton was subdued after announcing its results.

ASIA CURRENCIES

USD/CNY: 1Y NDFs shot up again to 6.7600 handle IN LATE Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. On Monday, PBoC fixed mid-point at 6.7035 vs. previous close of 6.7049. Onshore spot traded with an upside bias as well, and inched up to 6.7150 highs on Monday. We expect pair to eye the 6.7233 resistance next.

USD/CNH: Pair peaked at 6.7192 earlier on Monday before trading horizontally around 6.7150 again in the overnight session. China's politburo reiterated the need for a prudent monetary policy and remained cautiously optimistic, despite stronger than expected Q1 economic growth. We expect pair to eye the 6.7300 handle. If broken, will turn our attention to the 6.7500 resistance next.

USD/SGD: Pair was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. Focus for today will be on Singapore's March CPI. We expect headline inflation at 0.6% y/y in March (0.5% in February) and core inflation at 1.5% (1.5% prior). Pair is likely to eye the 1.3581 resistance next, before seeing a reversal to the 1.3510 support.

USD/IDR: 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. Onshore spot traded with a slight upside bias after the long weekend and opening flat at 14045. Pair inched up to over 1-week highs of 14096 as opponent Prabowo challenged Jokowi's victory in the presidential elections, which keeps threats of protests still alive. Oil prices were also on an uptrend, weighing on the rupiah but upside for USD/IDR possibly seemed capped and pair dropped back to 14080 into the close. We expect 13890 support to stand firm for now unless a Jokowi victory is confirmed, and a firmer break above 14090 remains likely.

USD/INR: 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure. Onshore spot gapped higher to open at 69.7500 after the long weekend vs. last close of 69.3550 as oil prices rallied on reports that US could end Iran sanction waivers. Pair traded to fresh 6-week highs of 69.8700 in early trading, before retreating to sub-69.7000 levels in the afternoon. Risk of break to the 70 handle has arisen due to oil price gains amid the election uncertainties, but we do not see much upside above it as the RBI has kept the door open for more rate cuts.

DATA RELEASES DUE TODAY

00:30 GMT - JP: Nikkei PMI Mfg (Apr P) index (Mkt: Prev: 49.2)

05:00 GMT - SG: Core CPI (Mar) 4cast: 1.5% y/y (Mkt: 1.7 Prev: 1.5)

05:00 GMT - SG: CPI (Mar) 4cast: 0.6% y/y (Mkt: 0 Prev: 0.5)

08:00 GMT - TW: Industrial Output (Mar) % y/y (Mkt: -1.5 Prev: -1.8)

08:30 GMT - HK: CPI (Mar) % y/y (Mkt: 2.2 Prev: 2.1)

12:30 GMT - CA: Wholesale Sales (Feb) [Prev: 0.6]

13:00 GMT - US: FHFA House Price Index (Feb) [Prev: 0.6]

13:00 GMT - EU: Consumer Sentiment (Apr A) [Prev: -7.2]

14:00 GMT - US: New Home Sales (Mar) 4cast: 645k (Mkt: 650 Prev: 667)

EVENTS & AUCTIONS

- UK: Parliament Returns from Easter Recess

- 04:35 GMT - JP: 2yr Bills Auction

- 10:30 GMT - EU: ECB Main Refinancing Operation Result

- 16:30 GMT - US: 52wk Bills Auction

- 18:00 GMT - US: 2yr Notes Auction


Forex - Asia Open - Overnight Highlights


 23:27 (GMT) 22 Apr

 [Forex Highlights]

Asia Overnight Highlights - 23 April 2019

ASIA OUTLOOK

On a subdued Easter Monday gains in oil price as the US stated it would eliminate waivers on purchases of Iranian oil the main story, giving a modest lift to the CAD. Elsewhere EUR/USD corrected higher but Cable remained weak.

Majors FX Highlights

The Bloomberg dollar spot index was little changed on Monday, and traded quietly around 97.400 before dipping slightly to 97.300 in the NY session. Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675. USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

Majors Data Highlights

US Mar existing home sales at 5.21m are fairly close to the average of Feb's strong 5.48m and Jan's weak 4.93m. While a little above Q4's average they are close to levels seen in Sep, Oct, and Nov. The picture is of a housing market stabilizing, perhaps modestly improving, after trending lower through most of 2018.

New home sales are due in the US, expected to correct lower by 3.3% to 645k. Europe remains quiet but UK MPs return to the parliament. This week therefore is one in which a new parliamentary process could begin in an attempt to find a consensus. This could by either through new indicative votes or the government introducing the bill, which MPs could amend, either to add a confirmatory referendum or soft Brexit options such as a customs union.

Emerging Asia FX Highlights

USD/Asians traded mostly higher earlier on Monday before retreating slightly and entering consolidation. USD/CNY 1Y NDFs shot up again to 6.7600 handle in late Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. USD/SGD was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. USD/IDR 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. USD/INR 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure.

Emerging Asia Data Highlights

Singapore's March CPI will be on focus today - the first one after the MAS decided to keep policy on hold.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar existing home sales -4.9% to 5.21m vs 5.30m exp.

- VIX index: 12.42 (+2.73%)

- Gold Spot: $1,275.18/oz (+0.02%)

- ICE Brent front contract: $74.04 (+$2.07)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.92 (+0.42%)

- 10y UST: 2.589% (+3bp) (Asia morning)

- DJI: 26,511.05 (-0.18%); S&P: 2,907.97 (+0.10%); Nasdaq: 8,015.27 (+0.22%)

ASIA NEWS

China: China will use "high-level" opening up measures to push for reforms, Xinhua reports, citing a meeting of the Central Committee for Financial and Economic Affairs chaired by President Xi Jinping. - BBG

Indonesia: Indonesia's 2019 budget deficit at 0.63% of GDP as of March compared to 0.58% in same period last year, according to statement from Finance Ministry. - BBG

India: Indian state refiners have firmed up oil supplies from alternate sources to replace Iran oil volumes for next month as contingency plan for non-renewal of U.S. waivers, a govt official says. - BBG

CURRENCIES

Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675.

USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

BONDS

USTs predictably quiet given the European holiday although the o/n move higher in yields does leak out further into the US session as oil bounce takes root. Lift in oil on the US Iran waiver end story encouraged USTs to trim back Friday's short covering burst. Existing homes data drops back broadly as expected, shrugged off. Curve a touch steeper despite the pending short end supply. 2s +0.6bps @ 2.39%, 5s +1.7bps @ 2.39%, 10s +3.1bps @ 2.59%, 30s +3.3bps @ 2.99%.

Agency Spreads: Freddie/Fannie 5s -0.7/-0.8 bps, 10s 0.0/-0.7 bps.

Swap Spreads: 2s -1.18bps, 5s -0.60bps, 10s -0.69bps.

EQUITIES

Equities saw a quiet day with strength in energy as oil prices increased balanced by modest losses in most sectors. A fairly light earnings calendar had little impact. Haliburton was subdued after announcing its results.

ASIA CURRENCIES

USD/CNY: 1Y NDFs shot up again to 6.7600 handle IN LATE Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. On Monday, PBoC fixed mid-point at 6.7035 vs. previous close of 6.7049. Onshore spot traded with an upside bias as well, and inched up to 6.7150 highs on Monday. We expect pair to eye the 6.7233 resistance next.

USD/CNH: Pair peaked at 6.7192 earlier on Monday before trading horizontally around 6.7150 again in the overnight session. China's politburo reiterated the need for a prudent monetary policy and remained cautiously optimistic, despite stronger than expected Q1 economic growth. We expect pair to eye the 6.7300 handle. If broken, will turn our attention to the 6.7500 resistance next.

USD/SGD: Pair was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. Focus for today will be on Singapore's March CPI. We expect headline inflation at 0.6% y/y in March (0.5% in February) and core inflation at 1.5% (1.5% prior). Pair is likely to eye the 1.3581 resistance next, before seeing a reversal to the 1.3510 support.

USD/IDR: 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. Onshore spot traded with a slight upside bias after the long weekend and opening flat at 14045. Pair inched up to over 1-week highs of 14096 as opponent Prabowo challenged Jokowi's victory in the presidential elections, which keeps threats of protests still alive. Oil prices were also on an uptrend, weighing on the rupiah but upside for USD/IDR possibly seemed capped and pair dropped back to 14080 into the close. We expect 13890 support to stand firm for now unless a Jokowi victory is confirmed, and a firmer break above 14090 remains likely.

USD/INR: 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure. Onshore spot gapped higher to open at 69.7500 after the long weekend vs. last close of 69.3550 as oil prices rallied on reports that US could end Iran sanction waivers. Pair traded to fresh 6-week highs of 69.8700 in early trading, before retreating to sub-69.7000 levels in the afternoon. Risk of break to the 70 handle has arisen due to oil price gains amid the election uncertainties, but we do not see much upside above it as the RBI has kept the door open for more rate cuts.

DATA RELEASES DUE TODAY

00:30 GMT - JP: Nikkei PMI Mfg (Apr P) index (Mkt: Prev: 49.2)

05:00 GMT - SG: Core CPI (Mar) 4cast: 1.5% y/y (Mkt: 1.7 Prev: 1.5)

05:00 GMT - SG: CPI (Mar) 4cast: 0.6% y/y (Mkt: 0 Prev: 0.5)

08:00 GMT - TW: Industrial Output (Mar) % y/y (Mkt: -1.5 Prev: -1.8)

08:30 GMT - HK: CPI (Mar) % y/y (Mkt: 2.2 Prev: 2.1)

12:30 GMT - CA: Wholesale Sales (Feb) [Prev: 0.6]

13:00 GMT - US: FHFA House Price Index (Feb) [Prev: 0.6]

13:00 GMT - EU: Consumer Sentiment (Apr A) [Prev: -7.2]

14:00 GMT - US: New Home Sales (Mar) 4cast: 645k (Mkt: 650 Prev: 667)

EVENTS & AUCTIONS

- UK: Parliament Returns from Easter Recess

- 04:35 GMT - JP: 2yr Bills Auction

- 10:30 GMT - EU: ECB Main Refinancing Operation Result

- 16:30 GMT - US: 52wk Bills Auction

- 18:00 GMT - US: 2yr Notes Auction


Forex - Asia Open - Overnight Highlights


 23:27 (GMT) 22 Apr

 [Forex Highlights]

Asia Overnight Highlights - 23 April 2019

ASIA OUTLOOK

On a subdued Easter Monday gains in oil price as the US stated it would eliminate waivers on purchases of Iranian oil the main story, giving a modest lift to the CAD. Elsewhere EUR/USD corrected higher but Cable remained weak.

Majors FX Highlights

The Bloomberg dollar spot index was little changed on Monday, and traded quietly around 97.400 before dipping slightly to 97.300 in the NY session. Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675. USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

Majors Data Highlights

US Mar existing home sales at 5.21m are fairly close to the average of Feb's strong 5.48m and Jan's weak 4.93m. While a little above Q4's average they are close to levels seen in Sep, Oct, and Nov. The picture is of a housing market stabilizing, perhaps modestly improving, after trending lower through most of 2018.

New home sales are due in the US, expected to correct lower by 3.3% to 645k. Europe remains quiet but UK MPs return to the parliament. This week therefore is one in which a new parliamentary process could begin in an attempt to find a consensus. This could by either through new indicative votes or the government introducing the bill, which MPs could amend, either to add a confirmatory referendum or soft Brexit options such as a customs union.

Emerging Asia FX Highlights

USD/Asians traded mostly higher earlier on Monday before retreating slightly and entering consolidation. USD/CNY 1Y NDFs shot up again to 6.7600 handle in late Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. USD/SGD was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. USD/IDR 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. USD/INR 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure.

Emerging Asia Data Highlights

Singapore's March CPI will be on focus today - the first one after the MAS decided to keep policy on hold.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar existing home sales -4.9% to 5.21m vs 5.30m exp.

- VIX index: 12.42 (+2.73%)

- Gold Spot: $1,275.18/oz (+0.02%)

- ICE Brent front contract: $74.04 (+$2.07)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.92 (+0.42%)

- 10y UST: 2.589% (+3bp) (Asia morning)

- DJI: 26,511.05 (-0.18%); S&P: 2,907.97 (+0.10%); Nasdaq: 8,015.27 (+0.22%)

ASIA NEWS

China: China will use "high-level" opening up measures to push for reforms, Xinhua reports, citing a meeting of the Central Committee for Financial and Economic Affairs chaired by President Xi Jinping. - BBG

Indonesia: Indonesia's 2019 budget deficit at 0.63% of GDP as of March compared to 0.58% in same period last year, according to statement from Finance Ministry. - BBG

India: Indian state refiners have firmed up oil supplies from alternate sources to replace Iran oil volumes for next month as contingency plan for non-renewal of U.S. waivers, a govt official says. - BBG

CURRENCIES

Trade was quiet with Europe closed for Easter Monday. The main story of the day being higher oil prices on the US stating it would eliminate waivers on oil purchases from Iran after the May 2 expiration. This saw USD/CAD fall below 1.3350. With AUD/USD slightly lower AUD/CAD fell to a level not seen since Apr 12, though still on the .95 handle.

EUR/USD saw a modest correction of its Thursday losses edging back above 1.1250. With no progress seen on Brexit negotiations over Easter, Cable extended its move below 1.30 to touch 1.2975, as EUR/GBP pushed up to .8675.

USD/JPY stayed in a very tight range marginally below 112.00. US existing home sales fell slightly short of consensus while Fed nominee Herman Cain withdrew from consideration, with no market response.

BONDS

USTs predictably quiet given the European holiday although the o/n move higher in yields does leak out further into the US session as oil bounce takes root. Lift in oil on the US Iran waiver end story encouraged USTs to trim back Friday's short covering burst. Existing homes data drops back broadly as expected, shrugged off. Curve a touch steeper despite the pending short end supply. 2s +0.6bps @ 2.39%, 5s +1.7bps @ 2.39%, 10s +3.1bps @ 2.59%, 30s +3.3bps @ 2.99%.

Agency Spreads: Freddie/Fannie 5s -0.7/-0.8 bps, 10s 0.0/-0.7 bps.

Swap Spreads: 2s -1.18bps, 5s -0.60bps, 10s -0.69bps.

EQUITIES

Equities saw a quiet day with strength in energy as oil prices increased balanced by modest losses in most sectors. A fairly light earnings calendar had little impact. Haliburton was subdued after announcing its results.

ASIA CURRENCIES

USD/CNY: 1Y NDFs shot up again to 6.7600 handle IN LATE Asian hours on Monday and traded horizontally around 6.7550 thereafter as liquidity was thin. On Monday, PBoC fixed mid-point at 6.7035 vs. previous close of 6.7049. Onshore spot traded with an upside bias as well, and inched up to 6.7150 highs on Monday. We expect pair to eye the 6.7233 resistance next.

USD/CNH: Pair peaked at 6.7192 earlier on Monday before trading horizontally around 6.7150 again in the overnight session. China's politburo reiterated the need for a prudent monetary policy and remained cautiously optimistic, despite stronger than expected Q1 economic growth. We expect pair to eye the 6.7300 handle. If broken, will turn our attention to the 6.7500 resistance next.

USD/SGD: Pair was bid up to fresh over 1-week highs of 1.3570 earlier on Monday but later retreated subtly to 1.3560-levels into the NY session as the USD remained quiet. Focus for today will be on Singapore's March CPI. We expect headline inflation at 0.6% y/y in March (0.5% in February) and core inflation at 1.5% (1.5% prior). Pair is likely to eye the 1.3581 resistance next, before seeing a reversal to the 1.3510 support.

USD/IDR: 1M NDFs extended its gains to 14193 earlier on Monday but was offered subsequently and returned to sub-14160 levels. Onshore spot traded with a slight upside bias after the long weekend and opening flat at 14045. Pair inched up to over 1-week highs of 14096 as opponent Prabowo challenged Jokowi's victory in the presidential elections, which keeps threats of protests still alive. Oil prices were also on an uptrend, weighing on the rupiah but upside for USD/IDR possibly seemed capped and pair dropped back to 14080 into the close. We expect 13890 support to stand firm for now unless a Jokowi victory is confirmed, and a firmer break above 14090 remains likely.

USD/INR: 1M NDFs broke above the 70 handle but it didn't appear firm, with highs capped at 70.2800 before a slip back to the big figure. Onshore spot gapped higher to open at 69.7500 after the long weekend vs. last close of 69.3550 as oil prices rallied on reports that US could end Iran sanction waivers. Pair traded to fresh 6-week highs of 69.8700 in early trading, before retreating to sub-69.7000 levels in the afternoon. Risk of break to the 70 handle has arisen due to oil price gains amid the election uncertainties, but we do not see much upside above it as the RBI has kept the door open for more rate cuts.

DATA RELEASES DUE TODAY

00:30 GMT - JP: Nikkei PMI Mfg (Apr P) index (Mkt: Prev: 49.2)

05:00 GMT - SG: Core CPI (Mar) 4cast: 1.5% y/y (Mkt: 1.7 Prev: 1.5)

05:00 GMT - SG: CPI (Mar) 4cast: 0.6% y/y (Mkt: 0 Prev: 0.5)

08:00 GMT - TW: Industrial Output (Mar) % y/y (Mkt: -1.5 Prev: -1.8)

08:30 GMT - HK: CPI (Mar) % y/y (Mkt: 2.2 Prev: 2.1)

12:30 GMT - CA: Wholesale Sales (Feb) [Prev: 0.6]

13:00 GMT - US: FHFA House Price Index (Feb) [Prev: 0.6]

13:00 GMT - EU: Consumer Sentiment (Apr A) [Prev: -7.2]

14:00 GMT - US: New Home Sales (Mar) 4cast: 645k (Mkt: 650 Prev: 667)

EVENTS & AUCTIONS

- UK: Parliament Returns from Easter Recess

- 04:35 GMT - JP: 2yr Bills Auction

- 10:30 GMT - EU: ECB Main Refinancing Operation Result

- 16:30 GMT - US: 52wk Bills Auction

- 18:00 GMT - US: 2yr Notes Auction


Forex - Asia Open - Overnight Highlights


 23:18 (GMT) 21 Apr

 [Forex Highlights]

Asia Overnight Highlights - 22 April 2019

ASIA OUTLOOK

Weak European and to a lesser extent strong US data weighed on EUR/USD, while GBP/USD fell despite firm UK data. US equities had a more positive day, but despite this and firm US data, UST yields fell.

Majors FX Highlights

The Bloomberg dollar spot index steadied around 97.350 on Friday with most markets closed for Good Friday. This was after hitting a 2.5-week highs of 97.485 on Thursday as US retail sales supported sentiment. Some risk aversion may be seen in the Asian hours today after the blasts in Sri Lanka on Sunday, but liquidity is likely to be thin as Europe is generally closed for Easter Monday.

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1230. GBP however shrugged off the upbeat UK retail sales and dropped to 1.3000-handle. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

Majors Data Highlights

Strong data from the US, Mar retail sales +1.6%, 1.2% ex autos and 0.9% ex auto and gas, regaining momentum after a weak Feb and leaving Q1 looking less weak, further supporting the Q1 GDP picture. This comes alongside a further low in initial claims of 192k, coming in the payroll survey week and implying a strong rise in Apr. This outweighs a modest slowing in Apr's Philly Fed to a still positive 8.5 from Mar's 13.7. Starts and permits disappoint in Mar, underperforming other recent housing sector signals. The flash April EZ composite PMI survey fell to 51.3 from 51.6 in March. The manufacturing corrected marginally higher to 47.8 (prev: 47.5) while the services sector fell to 52.5 (prev: 53.3). UK retail sales continued to surprise to the upside in this March update, with a jump of 1.2% m/m, ie a third successive rise.

Today's data focus in the US will be on existing home sales, which should correct lower after strong Feb gains. Easter Day is celebrated in many countries across the world.

Emerging Asia FX Highlights

USD/Asians traded mostly in a range-bound manner as most markets remained closed on Friday. USD/CNY 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. USD/SGD retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. USD/IDR 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. USD/INR 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets.

Emerging Asia Data Highlights

Last week, the Bank of Korea kept interest rates unchanged. Focus today on Thailand's March customs trade data, as no other tier 1 data is due.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar retail sales +1.6% vs 1.0% exp, ex autos +1.2% vs 0.7% exp.

- US Apr Philly Fed fell to 8.5 from 13.7 vs 11.0 exp.

- US initial claims fell to 192k from 197k vs 205k exp.

- US Feb business inventories +0.3% as exp.

- VIX index: 12.09 (-4.05%)

- Gold Spot: $1,275.39/oz (-0.03%)

- ICE Brent front contract: $71.97 (+$0.35)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.13 (+0.28%)

- 10y UST: 2.560% (0bp) (Asia morning)

- DJI: 26,559.54 (+0.42%); S&P: 2,905.03 (+0.16%); Nasdaq: 7,998.06 (+0.02%)

ASIA NEWS

China: The current reserve requirement ratio is "basically appropriate" as most Chinese economic indicators have improved and market liquidity is at "reasonable level," former PBOC official Sheng Songcheng writes in an article in Economic Information Daily. - BBG

Indonesia: Prabowo Subianto claimed victory for a third day in Indonesia's presidential election, dismissing unofficial quick counts showing a win for incumbent leader Joko Widodo. - BBG

India: Worries of a slowdown in the world's fastest-growing major economy dominated the thoughts of India's monetary policy makers, the minutes of their latest meeting show, suggesting that chances of another interest rate cut in the coming months are very much alive. - BBG

CURRENCIES

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1250. EUR/CHF also fell sharply on the data, but corrected later in the day.

EUR/SEK rose sharply in response to the higher than expected Swedish unemployment rate, though the rise in reality looks likely to be erratic. The smoothed seasonally adjusted version of the unemployment rate rose only very modestly to 6.3% from 6.2%.

While UK retail sales were much stronger than expected in March, rising 6.7% y/y and 1.1% m/m, GBP was almost unaffected. Some suspicion that the data is distorted by Brexit, Easter or weather, but GBP market also focused on Brexit more than data. GBP/USD dragged down by weak EUR/USD.

US and Canadian retail sales were both stronger than expected, and while the market response was modest, this provided support for both currencies against the EUR and GBP. EUR/USD touched 1.1225, GBP/USD below 1.30. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

BONDS

Further UST short covering o/n after 10s rejected the attempted drive through 2.59/6%. European morning data & bid cemented that. Strong retail sales & claims data couldn't dent with market already in pre-holiday squaring. US10s stayed pinned back to 2.55/54% pullback support. 2s -2.0bps @ 2.38%, 5s -3.2bps @ 2.37%, 10s -3.4bps @ 2.56%, 30s -3.3bps @ 2.96%.

Agency Spreads: Freddie/Fannie 5s 0.0/+0.1 bps, 10s +0.2/-0.8 bps.

Swap Spreads: 2s -0.47bps, 5s -0.18bps, 10s -0.13bps.

EQUITIES

Equities picked up ahead of the Easter break, more on positive earnings data in the industrial sector than upbeat economic data. Industrials led the gains with a subdued picture elsewhere, energy and financials slipping.

ASIA CURRENCIES

USD/CNY: 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. Upbeat China growth numbers are weakening the case for more stimulus. On Friday, PBoC fixed mid-point at 6.7043 vs. previous close of 6.7085. Onshore spot traded close to 6.7050 levels, remaining far from the lows of 6.6850-levels seen earlier in the week on China GDP beat. For USD/CNY, the next support (we estimate at 6.6700 handle) will likely be broken more from trade news than from fundamentals.

USD/CNH: Pair remained above the key 6.7000 handle on Friday, trading on either side of 6.7050 after touching highs of 6.7100+ earlier on Thursday. A break of the prior range above 6.7000 figure places emphasis on the technical support of 6.6694. This will likely be driven by further breakthrough in US-China trade talks.

USD/SGD: Pair retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. Focus for the week ahead will be on Singapore's March CPI, March industrial production and Q1 unemployment rate. We expect pair to break the 1.3553 resistance, which will turn our attention to the 1.3581 resistance next.

USD/IDR: 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. Onshore markets remained closed on Friday for Good Friday. We expect 13890 support to stand firm for now until the Jokowi victory is confirmed.

USD/INR: 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets. Onshore markets remained closed on Friday for Good Friday. We expect 69.8000 resistance area to continue to stand strong despite the election uncertainties, even as the downside below 68.5000 is also shallow.

DATA RELEASES DUE TODAY

n/a GMT - TH: Customs Exports (Mar) 4cast: % y/y (Mkt: -4.25 Prev: 5.91)

n/a GMT - TH: Customs Imports (Mar) [Mkt: -3, Prev: -10.03]

n/a GMT - TH: Customs Trade Balance (Mar) [Mkt: 750, Prev: 4034]

08:00 GMT - TW: Unemployment (Mar) 4cast: % (Mkt: Prev: 3.71)

14:00 GMT - US: Existing Home Sales (Mar) 4cast: 5.3mn (Mkt: 5.28 Prev: 5.51)

EVENTS & AUCTIONS

- 16:30 GMT - US: 3mth Bills Auction

- 16:30 GMT - US: 6mth Bills Auction


Forex - Asia Open - Overnight Highlights


 23:18 (GMT) 21 Apr

 [Forex Highlights]

Asia Overnight Highlights - 22 April 2019

ASIA OUTLOOK

Weak European and to a lesser extent strong US data weighed on EUR/USD, while GBP/USD fell despite firm UK data. US equities had a more positive day, but despite this and firm US data, UST yields fell.

Majors FX Highlights

The Bloomberg dollar spot index steadied around 97.350 on Friday with most markets closed for Good Friday. This was after hitting a 2.5-week highs of 97.485 on Thursday as US retail sales supported sentiment. Some risk aversion may be seen in the Asian hours today after the blasts in Sri Lanka on Sunday, but liquidity is likely to be thin as Europe is generally closed for Easter Monday.

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1230. GBP however shrugged off the upbeat UK retail sales and dropped to 1.3000-handle. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

Majors Data Highlights

Strong data from the US, Mar retail sales +1.6%, 1.2% ex autos and 0.9% ex auto and gas, regaining momentum after a weak Feb and leaving Q1 looking less weak, further supporting the Q1 GDP picture. This comes alongside a further low in initial claims of 192k, coming in the payroll survey week and implying a strong rise in Apr. This outweighs a modest slowing in Apr's Philly Fed to a still positive 8.5 from Mar's 13.7. Starts and permits disappoint in Mar, underperforming other recent housing sector signals. The flash April EZ composite PMI survey fell to 51.3 from 51.6 in March. The manufacturing corrected marginally higher to 47.8 (prev: 47.5) while the services sector fell to 52.5 (prev: 53.3). UK retail sales continued to surprise to the upside in this March update, with a jump of 1.2% m/m, ie a third successive rise.

Today's data focus in the US will be on existing home sales, which should correct lower after strong Feb gains. Easter Day is celebrated in many countries across the world.

Emerging Asia FX Highlights

USD/Asians traded mostly in a range-bound manner as most markets remained closed on Friday. USD/CNY 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. USD/SGD retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. USD/IDR 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. USD/INR 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets.

Emerging Asia Data Highlights

Last week, the Bank of Korea kept interest rates unchanged. Focus today on Thailand's March customs trade data, as no other tier 1 data is due.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar retail sales +1.6% vs 1.0% exp, ex autos +1.2% vs 0.7% exp.

- US Apr Philly Fed fell to 8.5 from 13.7 vs 11.0 exp.

- US initial claims fell to 192k from 197k vs 205k exp.

- US Feb business inventories +0.3% as exp.

- VIX index: 12.09 (-4.05%)

- Gold Spot: $1,275.39/oz (-0.03%)

- ICE Brent front contract: $71.97 (+$0.35)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.13 (+0.28%)

- 10y UST: 2.560% (0bp) (Asia morning)

- DJI: 26,559.54 (+0.42%); S&P: 2,905.03 (+0.16%); Nasdaq: 7,998.06 (+0.02%)

ASIA NEWS

China: The current reserve requirement ratio is "basically appropriate" as most Chinese economic indicators have improved and market liquidity is at "reasonable level," former PBOC official Sheng Songcheng writes in an article in Economic Information Daily. - BBG

Indonesia: Prabowo Subianto claimed victory for a third day in Indonesia's presidential election, dismissing unofficial quick counts showing a win for incumbent leader Joko Widodo. - BBG

India: Worries of a slowdown in the world's fastest-growing major economy dominated the thoughts of India's monetary policy makers, the minutes of their latest meeting show, suggesting that chances of another interest rate cut in the coming months are very much alive. - BBG

CURRENCIES

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1250. EUR/CHF also fell sharply on the data, but corrected later in the day.

EUR/SEK rose sharply in response to the higher than expected Swedish unemployment rate, though the rise in reality looks likely to be erratic. The smoothed seasonally adjusted version of the unemployment rate rose only very modestly to 6.3% from 6.2%.

While UK retail sales were much stronger than expected in March, rising 6.7% y/y and 1.1% m/m, GBP was almost unaffected. Some suspicion that the data is distorted by Brexit, Easter or weather, but GBP market also focused on Brexit more than data. GBP/USD dragged down by weak EUR/USD.

US and Canadian retail sales were both stronger than expected, and while the market response was modest, this provided support for both currencies against the EUR and GBP. EUR/USD touched 1.1225, GBP/USD below 1.30. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

BONDS

Further UST short covering o/n after 10s rejected the attempted drive through 2.59/6%. European morning data & bid cemented that. Strong retail sales & claims data couldn't dent with market already in pre-holiday squaring. US10s stayed pinned back to 2.55/54% pullback support. 2s -2.0bps @ 2.38%, 5s -3.2bps @ 2.37%, 10s -3.4bps @ 2.56%, 30s -3.3bps @ 2.96%.

Agency Spreads: Freddie/Fannie 5s 0.0/+0.1 bps, 10s +0.2/-0.8 bps.

Swap Spreads: 2s -0.47bps, 5s -0.18bps, 10s -0.13bps.

EQUITIES

Equities picked up ahead of the Easter break, more on positive earnings data in the industrial sector than upbeat economic data. Industrials led the gains with a subdued picture elsewhere, energy and financials slipping.

ASIA CURRENCIES

USD/CNY: 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. Upbeat China growth numbers are weakening the case for more stimulus. On Friday, PBoC fixed mid-point at 6.7043 vs. previous close of 6.7085. Onshore spot traded close to 6.7050 levels, remaining far from the lows of 6.6850-levels seen earlier in the week on China GDP beat. For USD/CNY, the next support (we estimate at 6.6700 handle) will likely be broken more from trade news than from fundamentals.

USD/CNH: Pair remained above the key 6.7000 handle on Friday, trading on either side of 6.7050 after touching highs of 6.7100+ earlier on Thursday. A break of the prior range above 6.7000 figure places emphasis on the technical support of 6.6694. This will likely be driven by further breakthrough in US-China trade talks.

USD/SGD: Pair retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. Focus for the week ahead will be on Singapore's March CPI, March industrial production and Q1 unemployment rate. We expect pair to break the 1.3553 resistance, which will turn our attention to the 1.3581 resistance next.

USD/IDR: 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. Onshore markets remained closed on Friday for Good Friday. We expect 13890 support to stand firm for now until the Jokowi victory is confirmed.

USD/INR: 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets. Onshore markets remained closed on Friday for Good Friday. We expect 69.8000 resistance area to continue to stand strong despite the election uncertainties, even as the downside below 68.5000 is also shallow.

DATA RELEASES DUE TODAY

n/a GMT - TH: Customs Exports (Mar) 4cast: % y/y (Mkt: -4.25 Prev: 5.91)

n/a GMT - TH: Customs Imports (Mar) [Mkt: -3, Prev: -10.03]

n/a GMT - TH: Customs Trade Balance (Mar) [Mkt: 750, Prev: 4034]

08:00 GMT - TW: Unemployment (Mar) 4cast: % (Mkt: Prev: 3.71)

14:00 GMT - US: Existing Home Sales (Mar) 4cast: 5.3mn (Mkt: 5.28 Prev: 5.51)

EVENTS & AUCTIONS

- 16:30 GMT - US: 3mth Bills Auction

- 16:30 GMT - US: 6mth Bills Auction


Forex - Asia Open - Overnight Highlights


 23:18 (GMT) 21 Apr

 [Forex Highlights]

Asia Overnight Highlights - 22 April 2019

ASIA OUTLOOK

Weak European and to a lesser extent strong US data weighed on EUR/USD, while GBP/USD fell despite firm UK data. US equities had a more positive day, but despite this and firm US data, UST yields fell.

Majors FX Highlights

The Bloomberg dollar spot index steadied around 97.350 on Friday with most markets closed for Good Friday. This was after hitting a 2.5-week highs of 97.485 on Thursday as US retail sales supported sentiment. Some risk aversion may be seen in the Asian hours today after the blasts in Sri Lanka on Sunday, but liquidity is likely to be thin as Europe is generally closed for Easter Monday.

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1230. GBP however shrugged off the upbeat UK retail sales and dropped to 1.3000-handle. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

Majors Data Highlights

Strong data from the US, Mar retail sales +1.6%, 1.2% ex autos and 0.9% ex auto and gas, regaining momentum after a weak Feb and leaving Q1 looking less weak, further supporting the Q1 GDP picture. This comes alongside a further low in initial claims of 192k, coming in the payroll survey week and implying a strong rise in Apr. This outweighs a modest slowing in Apr's Philly Fed to a still positive 8.5 from Mar's 13.7. Starts and permits disappoint in Mar, underperforming other recent housing sector signals. The flash April EZ composite PMI survey fell to 51.3 from 51.6 in March. The manufacturing corrected marginally higher to 47.8 (prev: 47.5) while the services sector fell to 52.5 (prev: 53.3). UK retail sales continued to surprise to the upside in this March update, with a jump of 1.2% m/m, ie a third successive rise.

Today's data focus in the US will be on existing home sales, which should correct lower after strong Feb gains. Easter Day is celebrated in many countries across the world.

Emerging Asia FX Highlights

USD/Asians traded mostly in a range-bound manner as most markets remained closed on Friday. USD/CNY 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. USD/SGD retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. USD/IDR 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. USD/INR 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets.

Emerging Asia Data Highlights

Last week, the Bank of Korea kept interest rates unchanged. Focus today on Thailand's March customs trade data, as no other tier 1 data is due.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar retail sales +1.6% vs 1.0% exp, ex autos +1.2% vs 0.7% exp.

- US Apr Philly Fed fell to 8.5 from 13.7 vs 11.0 exp.

- US initial claims fell to 192k from 197k vs 205k exp.

- US Feb business inventories +0.3% as exp.

- VIX index: 12.09 (-4.05%)

- Gold Spot: $1,275.39/oz (-0.03%)

- ICE Brent front contract: $71.97 (+$0.35)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.13 (+0.28%)

- 10y UST: 2.560% (0bp) (Asia morning)

- DJI: 26,559.54 (+0.42%); S&P: 2,905.03 (+0.16%); Nasdaq: 7,998.06 (+0.02%)

ASIA NEWS

China: The current reserve requirement ratio is "basically appropriate" as most Chinese economic indicators have improved and market liquidity is at "reasonable level," former PBOC official Sheng Songcheng writes in an article in Economic Information Daily. - BBG

Indonesia: Prabowo Subianto claimed victory for a third day in Indonesia's presidential election, dismissing unofficial quick counts showing a win for incumbent leader Joko Widodo. - BBG

India: Worries of a slowdown in the world's fastest-growing major economy dominated the thoughts of India's monetary policy makers, the minutes of their latest meeting show, suggesting that chances of another interest rate cut in the coming months are very much alive. - BBG

CURRENCIES

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1250. EUR/CHF also fell sharply on the data, but corrected later in the day.

EUR/SEK rose sharply in response to the higher than expected Swedish unemployment rate, though the rise in reality looks likely to be erratic. The smoothed seasonally adjusted version of the unemployment rate rose only very modestly to 6.3% from 6.2%.

While UK retail sales were much stronger than expected in March, rising 6.7% y/y and 1.1% m/m, GBP was almost unaffected. Some suspicion that the data is distorted by Brexit, Easter or weather, but GBP market also focused on Brexit more than data. GBP/USD dragged down by weak EUR/USD.

US and Canadian retail sales were both stronger than expected, and while the market response was modest, this provided support for both currencies against the EUR and GBP. EUR/USD touched 1.1225, GBP/USD below 1.30. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

BONDS

Further UST short covering o/n after 10s rejected the attempted drive through 2.59/6%. European morning data & bid cemented that. Strong retail sales & claims data couldn't dent with market already in pre-holiday squaring. US10s stayed pinned back to 2.55/54% pullback support. 2s -2.0bps @ 2.38%, 5s -3.2bps @ 2.37%, 10s -3.4bps @ 2.56%, 30s -3.3bps @ 2.96%.

Agency Spreads: Freddie/Fannie 5s 0.0/+0.1 bps, 10s +0.2/-0.8 bps.

Swap Spreads: 2s -0.47bps, 5s -0.18bps, 10s -0.13bps.

EQUITIES

Equities picked up ahead of the Easter break, more on positive earnings data in the industrial sector than upbeat economic data. Industrials led the gains with a subdued picture elsewhere, energy and financials slipping.

ASIA CURRENCIES

USD/CNY: 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. Upbeat China growth numbers are weakening the case for more stimulus. On Friday, PBoC fixed mid-point at 6.7043 vs. previous close of 6.7085. Onshore spot traded close to 6.7050 levels, remaining far from the lows of 6.6850-levels seen earlier in the week on China GDP beat. For USD/CNY, the next support (we estimate at 6.6700 handle) will likely be broken more from trade news than from fundamentals.

USD/CNH: Pair remained above the key 6.7000 handle on Friday, trading on either side of 6.7050 after touching highs of 6.7100+ earlier on Thursday. A break of the prior range above 6.7000 figure places emphasis on the technical support of 6.6694. This will likely be driven by further breakthrough in US-China trade talks.

USD/SGD: Pair retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. Focus for the week ahead will be on Singapore's March CPI, March industrial production and Q1 unemployment rate. We expect pair to break the 1.3553 resistance, which will turn our attention to the 1.3581 resistance next.

USD/IDR: 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. Onshore markets remained closed on Friday for Good Friday. We expect 13890 support to stand firm for now until the Jokowi victory is confirmed.

USD/INR: 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets. Onshore markets remained closed on Friday for Good Friday. We expect 69.8000 resistance area to continue to stand strong despite the election uncertainties, even as the downside below 68.5000 is also shallow.

DATA RELEASES DUE TODAY

n/a GMT - TH: Customs Exports (Mar) 4cast: % y/y (Mkt: -4.25 Prev: 5.91)

n/a GMT - TH: Customs Imports (Mar) [Mkt: -3, Prev: -10.03]

n/a GMT - TH: Customs Trade Balance (Mar) [Mkt: 750, Prev: 4034]

08:00 GMT - TW: Unemployment (Mar) 4cast: % (Mkt: Prev: 3.71)

14:00 GMT - US: Existing Home Sales (Mar) 4cast: 5.3mn (Mkt: 5.28 Prev: 5.51)

EVENTS & AUCTIONS

- 16:30 GMT - US: 3mth Bills Auction

- 16:30 GMT - US: 6mth Bills Auction


Forex - Asia Open - Overnight Highlights


 23:18 (GMT) 21 Apr

 [Forex Highlights]

Asia Overnight Highlights - 22 April 2019

ASIA OUTLOOK

Weak European and to a lesser extent strong US data weighed on EUR/USD, while GBP/USD fell despite firm UK data. US equities had a more positive day, but despite this and firm US data, UST yields fell.

Majors FX Highlights

The Bloomberg dollar spot index steadied around 97.350 on Friday with most markets closed for Good Friday. This was after hitting a 2.5-week highs of 97.485 on Thursday as US retail sales supported sentiment. Some risk aversion may be seen in the Asian hours today after the blasts in Sri Lanka on Sunday, but liquidity is likely to be thin as Europe is generally closed for Easter Monday.

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1230. GBP however shrugged off the upbeat UK retail sales and dropped to 1.3000-handle. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

Majors Data Highlights

Strong data from the US, Mar retail sales +1.6%, 1.2% ex autos and 0.9% ex auto and gas, regaining momentum after a weak Feb and leaving Q1 looking less weak, further supporting the Q1 GDP picture. This comes alongside a further low in initial claims of 192k, coming in the payroll survey week and implying a strong rise in Apr. This outweighs a modest slowing in Apr's Philly Fed to a still positive 8.5 from Mar's 13.7. Starts and permits disappoint in Mar, underperforming other recent housing sector signals. The flash April EZ composite PMI survey fell to 51.3 from 51.6 in March. The manufacturing corrected marginally higher to 47.8 (prev: 47.5) while the services sector fell to 52.5 (prev: 53.3). UK retail sales continued to surprise to the upside in this March update, with a jump of 1.2% m/m, ie a third successive rise.

Today's data focus in the US will be on existing home sales, which should correct lower after strong Feb gains. Easter Day is celebrated in many countries across the world.

Emerging Asia FX Highlights

USD/Asians traded mostly in a range-bound manner as most markets remained closed on Friday. USD/CNY 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. USD/SGD retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. USD/IDR 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. USD/INR 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets.

Emerging Asia Data Highlights

Last week, the Bank of Korea kept interest rates unchanged. Focus today on Thailand's March customs trade data, as no other tier 1 data is due.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar retail sales +1.6% vs 1.0% exp, ex autos +1.2% vs 0.7% exp.

- US Apr Philly Fed fell to 8.5 from 13.7 vs 11.0 exp.

- US initial claims fell to 192k from 197k vs 205k exp.

- US Feb business inventories +0.3% as exp.

- VIX index: 12.09 (-4.05%)

- Gold Spot: $1,275.39/oz (-0.03%)

- ICE Brent front contract: $71.97 (+$0.35)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.13 (+0.28%)

- 10y UST: 2.560% (0bp) (Asia morning)

- DJI: 26,559.54 (+0.42%); S&P: 2,905.03 (+0.16%); Nasdaq: 7,998.06 (+0.02%)

ASIA NEWS

China: The current reserve requirement ratio is "basically appropriate" as most Chinese economic indicators have improved and market liquidity is at "reasonable level," former PBOC official Sheng Songcheng writes in an article in Economic Information Daily. - BBG

Indonesia: Prabowo Subianto claimed victory for a third day in Indonesia's presidential election, dismissing unofficial quick counts showing a win for incumbent leader Joko Widodo. - BBG

India: Worries of a slowdown in the world's fastest-growing major economy dominated the thoughts of India's monetary policy makers, the minutes of their latest meeting show, suggesting that chances of another interest rate cut in the coming months are very much alive. - BBG

CURRENCIES

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1250. EUR/CHF also fell sharply on the data, but corrected later in the day.

EUR/SEK rose sharply in response to the higher than expected Swedish unemployment rate, though the rise in reality looks likely to be erratic. The smoothed seasonally adjusted version of the unemployment rate rose only very modestly to 6.3% from 6.2%.

While UK retail sales were much stronger than expected in March, rising 6.7% y/y and 1.1% m/m, GBP was almost unaffected. Some suspicion that the data is distorted by Brexit, Easter or weather, but GBP market also focused on Brexit more than data. GBP/USD dragged down by weak EUR/USD.

US and Canadian retail sales were both stronger than expected, and while the market response was modest, this provided support for both currencies against the EUR and GBP. EUR/USD touched 1.1225, GBP/USD below 1.30. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

BONDS

Further UST short covering o/n after 10s rejected the attempted drive through 2.59/6%. European morning data & bid cemented that. Strong retail sales & claims data couldn't dent with market already in pre-holiday squaring. US10s stayed pinned back to 2.55/54% pullback support. 2s -2.0bps @ 2.38%, 5s -3.2bps @ 2.37%, 10s -3.4bps @ 2.56%, 30s -3.3bps @ 2.96%.

Agency Spreads: Freddie/Fannie 5s 0.0/+0.1 bps, 10s +0.2/-0.8 bps.

Swap Spreads: 2s -0.47bps, 5s -0.18bps, 10s -0.13bps.

EQUITIES

Equities picked up ahead of the Easter break, more on positive earnings data in the industrial sector than upbeat economic data. Industrials led the gains with a subdued picture elsewhere, energy and financials slipping.

ASIA CURRENCIES

USD/CNY: 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. Upbeat China growth numbers are weakening the case for more stimulus. On Friday, PBoC fixed mid-point at 6.7043 vs. previous close of 6.7085. Onshore spot traded close to 6.7050 levels, remaining far from the lows of 6.6850-levels seen earlier in the week on China GDP beat. For USD/CNY, the next support (we estimate at 6.6700 handle) will likely be broken more from trade news than from fundamentals.

USD/CNH: Pair remained above the key 6.7000 handle on Friday, trading on either side of 6.7050 after touching highs of 6.7100+ earlier on Thursday. A break of the prior range above 6.7000 figure places emphasis on the technical support of 6.6694. This will likely be driven by further breakthrough in US-China trade talks.

USD/SGD: Pair retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. Focus for the week ahead will be on Singapore's March CPI, March industrial production and Q1 unemployment rate. We expect pair to break the 1.3553 resistance, which will turn our attention to the 1.3581 resistance next.

USD/IDR: 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. Onshore markets remained closed on Friday for Good Friday. We expect 13890 support to stand firm for now until the Jokowi victory is confirmed.

USD/INR: 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets. Onshore markets remained closed on Friday for Good Friday. We expect 69.8000 resistance area to continue to stand strong despite the election uncertainties, even as the downside below 68.5000 is also shallow.

DATA RELEASES DUE TODAY

n/a GMT - TH: Customs Exports (Mar) 4cast: % y/y (Mkt: -4.25 Prev: 5.91)

n/a GMT - TH: Customs Imports (Mar) [Mkt: -3, Prev: -10.03]

n/a GMT - TH: Customs Trade Balance (Mar) [Mkt: 750, Prev: 4034]

08:00 GMT - TW: Unemployment (Mar) 4cast: % (Mkt: Prev: 3.71)

14:00 GMT - US: Existing Home Sales (Mar) 4cast: 5.3mn (Mkt: 5.28 Prev: 5.51)

EVENTS & AUCTIONS

- 16:30 GMT - US: 3mth Bills Auction

- 16:30 GMT - US: 6mth Bills Auction


Forex - Asia Open - Overnight Highlights


 23:18 (GMT) 21 Apr

 [Forex Highlights]

Asia Overnight Highlights - 22 April 2019

ASIA OUTLOOK

Weak European and to a lesser extent strong US data weighed on EUR/USD, while GBP/USD fell despite firm UK data. US equities had a more positive day, but despite this and firm US data, UST yields fell.

Majors FX Highlights

The Bloomberg dollar spot index steadied around 97.350 on Friday with most markets closed for Good Friday. This was after hitting a 2.5-week highs of 97.485 on Thursday as US retail sales supported sentiment. Some risk aversion may be seen in the Asian hours today after the blasts in Sri Lanka on Sunday, but liquidity is likely to be thin as Europe is generally closed for Easter Monday.

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1230. GBP however shrugged off the upbeat UK retail sales and dropped to 1.3000-handle. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

Majors Data Highlights

Strong data from the US, Mar retail sales +1.6%, 1.2% ex autos and 0.9% ex auto and gas, regaining momentum after a weak Feb and leaving Q1 looking less weak, further supporting the Q1 GDP picture. This comes alongside a further low in initial claims of 192k, coming in the payroll survey week and implying a strong rise in Apr. This outweighs a modest slowing in Apr's Philly Fed to a still positive 8.5 from Mar's 13.7. Starts and permits disappoint in Mar, underperforming other recent housing sector signals. The flash April EZ composite PMI survey fell to 51.3 from 51.6 in March. The manufacturing corrected marginally higher to 47.8 (prev: 47.5) while the services sector fell to 52.5 (prev: 53.3). UK retail sales continued to surprise to the upside in this March update, with a jump of 1.2% m/m, ie a third successive rise.

Today's data focus in the US will be on existing home sales, which should correct lower after strong Feb gains. Easter Day is celebrated in many countries across the world.

Emerging Asia FX Highlights

USD/Asians traded mostly in a range-bound manner as most markets remained closed on Friday. USD/CNY 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. USD/SGD retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. USD/IDR 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. USD/INR 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets.

Emerging Asia Data Highlights

Last week, the Bank of Korea kept interest rates unchanged. Focus today on Thailand's March customs trade data, as no other tier 1 data is due.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar retail sales +1.6% vs 1.0% exp, ex autos +1.2% vs 0.7% exp.

- US Apr Philly Fed fell to 8.5 from 13.7 vs 11.0 exp.

- US initial claims fell to 192k from 197k vs 205k exp.

- US Feb business inventories +0.3% as exp.

- VIX index: 12.09 (-4.05%)

- Gold Spot: $1,275.39/oz (-0.03%)

- ICE Brent front contract: $71.97 (+$0.35)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.13 (+0.28%)

- 10y UST: 2.560% (0bp) (Asia morning)

- DJI: 26,559.54 (+0.42%); S&P: 2,905.03 (+0.16%); Nasdaq: 7,998.06 (+0.02%)

ASIA NEWS

China: The current reserve requirement ratio is "basically appropriate" as most Chinese economic indicators have improved and market liquidity is at "reasonable level," former PBOC official Sheng Songcheng writes in an article in Economic Information Daily. - BBG

Indonesia: Prabowo Subianto claimed victory for a third day in Indonesia's presidential election, dismissing unofficial quick counts showing a win for incumbent leader Joko Widodo. - BBG

India: Worries of a slowdown in the world's fastest-growing major economy dominated the thoughts of India's monetary policy makers, the minutes of their latest meeting show, suggesting that chances of another interest rate cut in the coming months are very much alive. - BBG

CURRENCIES

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1250. EUR/CHF also fell sharply on the data, but corrected later in the day.

EUR/SEK rose sharply in response to the higher than expected Swedish unemployment rate, though the rise in reality looks likely to be erratic. The smoothed seasonally adjusted version of the unemployment rate rose only very modestly to 6.3% from 6.2%.

While UK retail sales were much stronger than expected in March, rising 6.7% y/y and 1.1% m/m, GBP was almost unaffected. Some suspicion that the data is distorted by Brexit, Easter or weather, but GBP market also focused on Brexit more than data. GBP/USD dragged down by weak EUR/USD.

US and Canadian retail sales were both stronger than expected, and while the market response was modest, this provided support for both currencies against the EUR and GBP. EUR/USD touched 1.1225, GBP/USD below 1.30. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

BONDS

Further UST short covering o/n after 10s rejected the attempted drive through 2.59/6%. European morning data & bid cemented that. Strong retail sales & claims data couldn't dent with market already in pre-holiday squaring. US10s stayed pinned back to 2.55/54% pullback support. 2s -2.0bps @ 2.38%, 5s -3.2bps @ 2.37%, 10s -3.4bps @ 2.56%, 30s -3.3bps @ 2.96%.

Agency Spreads: Freddie/Fannie 5s 0.0/+0.1 bps, 10s +0.2/-0.8 bps.

Swap Spreads: 2s -0.47bps, 5s -0.18bps, 10s -0.13bps.

EQUITIES

Equities picked up ahead of the Easter break, more on positive earnings data in the industrial sector than upbeat economic data. Industrials led the gains with a subdued picture elsewhere, energy and financials slipping.

ASIA CURRENCIES

USD/CNY: 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. Upbeat China growth numbers are weakening the case for more stimulus. On Friday, PBoC fixed mid-point at 6.7043 vs. previous close of 6.7085. Onshore spot traded close to 6.7050 levels, remaining far from the lows of 6.6850-levels seen earlier in the week on China GDP beat. For USD/CNY, the next support (we estimate at 6.6700 handle) will likely be broken more from trade news than from fundamentals.

USD/CNH: Pair remained above the key 6.7000 handle on Friday, trading on either side of 6.7050 after touching highs of 6.7100+ earlier on Thursday. A break of the prior range above 6.7000 figure places emphasis on the technical support of 6.6694. This will likely be driven by further breakthrough in US-China trade talks.

USD/SGD: Pair retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. Focus for the week ahead will be on Singapore's March CPI, March industrial production and Q1 unemployment rate. We expect pair to break the 1.3553 resistance, which will turn our attention to the 1.3581 resistance next.

USD/IDR: 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. Onshore markets remained closed on Friday for Good Friday. We expect 13890 support to stand firm for now until the Jokowi victory is confirmed.

USD/INR: 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets. Onshore markets remained closed on Friday for Good Friday. We expect 69.8000 resistance area to continue to stand strong despite the election uncertainties, even as the downside below 68.5000 is also shallow.

DATA RELEASES DUE TODAY

n/a GMT - TH: Customs Exports (Mar) 4cast: % y/y (Mkt: -4.25 Prev: 5.91)

n/a GMT - TH: Customs Imports (Mar) [Mkt: -3, Prev: -10.03]

n/a GMT - TH: Customs Trade Balance (Mar) [Mkt: 750, Prev: 4034]

08:00 GMT - TW: Unemployment (Mar) 4cast: % (Mkt: Prev: 3.71)

14:00 GMT - US: Existing Home Sales (Mar) 4cast: 5.3mn (Mkt: 5.28 Prev: 5.51)

EVENTS & AUCTIONS

- 16:30 GMT - US: 3mth Bills Auction

- 16:30 GMT - US: 6mth Bills Auction


Forex - Asia Open - Overnight Highlights


 23:18 (GMT) 21 Apr

 [Forex Highlights]

Asia Overnight Highlights - 22 April 2019

ASIA OUTLOOK

Weak European and to a lesser extent strong US data weighed on EUR/USD, while GBP/USD fell despite firm UK data. US equities had a more positive day, but despite this and firm US data, UST yields fell.

Majors FX Highlights

The Bloomberg dollar spot index steadied around 97.350 on Friday with most markets closed for Good Friday. This was after hitting a 2.5-week highs of 97.485 on Thursday as US retail sales supported sentiment. Some risk aversion may be seen in the Asian hours today after the blasts in Sri Lanka on Sunday, but liquidity is likely to be thin as Europe is generally closed for Easter Monday.

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1230. GBP however shrugged off the upbeat UK retail sales and dropped to 1.3000-handle. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

Majors Data Highlights

Strong data from the US, Mar retail sales +1.6%, 1.2% ex autos and 0.9% ex auto and gas, regaining momentum after a weak Feb and leaving Q1 looking less weak, further supporting the Q1 GDP picture. This comes alongside a further low in initial claims of 192k, coming in the payroll survey week and implying a strong rise in Apr. This outweighs a modest slowing in Apr's Philly Fed to a still positive 8.5 from Mar's 13.7. Starts and permits disappoint in Mar, underperforming other recent housing sector signals. The flash April EZ composite PMI survey fell to 51.3 from 51.6 in March. The manufacturing corrected marginally higher to 47.8 (prev: 47.5) while the services sector fell to 52.5 (prev: 53.3). UK retail sales continued to surprise to the upside in this March update, with a jump of 1.2% m/m, ie a third successive rise.

Today's data focus in the US will be on existing home sales, which should correct lower after strong Feb gains. Easter Day is celebrated in many countries across the world.

Emerging Asia FX Highlights

USD/Asians traded mostly in a range-bound manner as most markets remained closed on Friday. USD/CNY 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. USD/SGD retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. USD/IDR 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. USD/INR 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets.

Emerging Asia Data Highlights

Last week, the Bank of Korea kept interest rates unchanged. Focus today on Thailand's March customs trade data, as no other tier 1 data is due.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar retail sales +1.6% vs 1.0% exp, ex autos +1.2% vs 0.7% exp.

- US Apr Philly Fed fell to 8.5 from 13.7 vs 11.0 exp.

- US initial claims fell to 192k from 197k vs 205k exp.

- US Feb business inventories +0.3% as exp.

- VIX index: 12.09 (-4.05%)

- Gold Spot: $1,275.39/oz (-0.03%)

- ICE Brent front contract: $71.97 (+$0.35)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.13 (+0.28%)

- 10y UST: 2.560% (0bp) (Asia morning)

- DJI: 26,559.54 (+0.42%); S&P: 2,905.03 (+0.16%); Nasdaq: 7,998.06 (+0.02%)

ASIA NEWS

China: The current reserve requirement ratio is "basically appropriate" as most Chinese economic indicators have improved and market liquidity is at "reasonable level," former PBOC official Sheng Songcheng writes in an article in Economic Information Daily. - BBG

Indonesia: Prabowo Subianto claimed victory for a third day in Indonesia's presidential election, dismissing unofficial quick counts showing a win for incumbent leader Joko Widodo. - BBG

India: Worries of a slowdown in the world's fastest-growing major economy dominated the thoughts of India's monetary policy makers, the minutes of their latest meeting show, suggesting that chances of another interest rate cut in the coming months are very much alive. - BBG

CURRENCIES

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1250. EUR/CHF also fell sharply on the data, but corrected later in the day.

EUR/SEK rose sharply in response to the higher than expected Swedish unemployment rate, though the rise in reality looks likely to be erratic. The smoothed seasonally adjusted version of the unemployment rate rose only very modestly to 6.3% from 6.2%.

While UK retail sales were much stronger than expected in March, rising 6.7% y/y and 1.1% m/m, GBP was almost unaffected. Some suspicion that the data is distorted by Brexit, Easter or weather, but GBP market also focused on Brexit more than data. GBP/USD dragged down by weak EUR/USD.

US and Canadian retail sales were both stronger than expected, and while the market response was modest, this provided support for both currencies against the EUR and GBP. EUR/USD touched 1.1225, GBP/USD below 1.30. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

BONDS

Further UST short covering o/n after 10s rejected the attempted drive through 2.59/6%. European morning data & bid cemented that. Strong retail sales & claims data couldn't dent with market already in pre-holiday squaring. US10s stayed pinned back to 2.55/54% pullback support. 2s -2.0bps @ 2.38%, 5s -3.2bps @ 2.37%, 10s -3.4bps @ 2.56%, 30s -3.3bps @ 2.96%.

Agency Spreads: Freddie/Fannie 5s 0.0/+0.1 bps, 10s +0.2/-0.8 bps.

Swap Spreads: 2s -0.47bps, 5s -0.18bps, 10s -0.13bps.

EQUITIES

Equities picked up ahead of the Easter break, more on positive earnings data in the industrial sector than upbeat economic data. Industrials led the gains with a subdued picture elsewhere, energy and financials slipping.

ASIA CURRENCIES

USD/CNY: 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. Upbeat China growth numbers are weakening the case for more stimulus. On Friday, PBoC fixed mid-point at 6.7043 vs. previous close of 6.7085. Onshore spot traded close to 6.7050 levels, remaining far from the lows of 6.6850-levels seen earlier in the week on China GDP beat. For USD/CNY, the next support (we estimate at 6.6700 handle) will likely be broken more from trade news than from fundamentals.

USD/CNH: Pair remained above the key 6.7000 handle on Friday, trading on either side of 6.7050 after touching highs of 6.7100+ earlier on Thursday. A break of the prior range above 6.7000 figure places emphasis on the technical support of 6.6694. This will likely be driven by further breakthrough in US-China trade talks.

USD/SGD: Pair retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. Focus for the week ahead will be on Singapore's March CPI, March industrial production and Q1 unemployment rate. We expect pair to break the 1.3553 resistance, which will turn our attention to the 1.3581 resistance next.

USD/IDR: 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. Onshore markets remained closed on Friday for Good Friday. We expect 13890 support to stand firm for now until the Jokowi victory is confirmed.

USD/INR: 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets. Onshore markets remained closed on Friday for Good Friday. We expect 69.8000 resistance area to continue to stand strong despite the election uncertainties, even as the downside below 68.5000 is also shallow.

DATA RELEASES DUE TODAY

n/a GMT - TH: Customs Exports (Mar) 4cast: % y/y (Mkt: -4.25 Prev: 5.91)

n/a GMT - TH: Customs Imports (Mar) [Mkt: -3, Prev: -10.03]

n/a GMT - TH: Customs Trade Balance (Mar) [Mkt: 750, Prev: 4034]

08:00 GMT - TW: Unemployment (Mar) 4cast: % (Mkt: Prev: 3.71)

14:00 GMT - US: Existing Home Sales (Mar) 4cast: 5.3mn (Mkt: 5.28 Prev: 5.51)

EVENTS & AUCTIONS

- 16:30 GMT - US: 3mth Bills Auction

- 16:30 GMT - US: 6mth Bills Auction


Forex - Asia Open - Overnight Highlights


 23:18 (GMT) 21 Apr

 [Forex Highlights]

Asia Overnight Highlights - 22 April 2019

ASIA OUTLOOK

Weak European and to a lesser extent strong US data weighed on EUR/USD, while GBP/USD fell despite firm UK data. US equities had a more positive day, but despite this and firm US data, UST yields fell.

Majors FX Highlights

The Bloomberg dollar spot index steadied around 97.350 on Friday with most markets closed for Good Friday. This was after hitting a 2.5-week highs of 97.485 on Thursday as US retail sales supported sentiment. Some risk aversion may be seen in the Asian hours today after the blasts in Sri Lanka on Sunday, but liquidity is likely to be thin as Europe is generally closed for Easter Monday.

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1230. GBP however shrugged off the upbeat UK retail sales and dropped to 1.3000-handle. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

Majors Data Highlights

Strong data from the US, Mar retail sales +1.6%, 1.2% ex autos and 0.9% ex auto and gas, regaining momentum after a weak Feb and leaving Q1 looking less weak, further supporting the Q1 GDP picture. This comes alongside a further low in initial claims of 192k, coming in the payroll survey week and implying a strong rise in Apr. This outweighs a modest slowing in Apr's Philly Fed to a still positive 8.5 from Mar's 13.7. Starts and permits disappoint in Mar, underperforming other recent housing sector signals. The flash April EZ composite PMI survey fell to 51.3 from 51.6 in March. The manufacturing corrected marginally higher to 47.8 (prev: 47.5) while the services sector fell to 52.5 (prev: 53.3). UK retail sales continued to surprise to the upside in this March update, with a jump of 1.2% m/m, ie a third successive rise.

Today's data focus in the US will be on existing home sales, which should correct lower after strong Feb gains. Easter Day is celebrated in many countries across the world.

Emerging Asia FX Highlights

USD/Asians traded mostly in a range-bound manner as most markets remained closed on Friday. USD/CNY 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. USD/SGD retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. USD/IDR 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. USD/INR 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets.

Emerging Asia Data Highlights

Last week, the Bank of Korea kept interest rates unchanged. Focus today on Thailand's March customs trade data, as no other tier 1 data is due.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar retail sales +1.6% vs 1.0% exp, ex autos +1.2% vs 0.7% exp.

- US Apr Philly Fed fell to 8.5 from 13.7 vs 11.0 exp.

- US initial claims fell to 192k from 197k vs 205k exp.

- US Feb business inventories +0.3% as exp.

- VIX index: 12.09 (-4.05%)

- Gold Spot: $1,275.39/oz (-0.03%)

- ICE Brent front contract: $71.97 (+$0.35)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.13 (+0.28%)

- 10y UST: 2.560% (0bp) (Asia morning)

- DJI: 26,559.54 (+0.42%); S&P: 2,905.03 (+0.16%); Nasdaq: 7,998.06 (+0.02%)

ASIA NEWS

China: The current reserve requirement ratio is "basically appropriate" as most Chinese economic indicators have improved and market liquidity is at "reasonable level," former PBOC official Sheng Songcheng writes in an article in Economic Information Daily. - BBG

Indonesia: Prabowo Subianto claimed victory for a third day in Indonesia's presidential election, dismissing unofficial quick counts showing a win for incumbent leader Joko Widodo. - BBG

India: Worries of a slowdown in the world's fastest-growing major economy dominated the thoughts of India's monetary policy makers, the minutes of their latest meeting show, suggesting that chances of another interest rate cut in the coming months are very much alive. - BBG

CURRENCIES

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1250. EUR/CHF also fell sharply on the data, but corrected later in the day.

EUR/SEK rose sharply in response to the higher than expected Swedish unemployment rate, though the rise in reality looks likely to be erratic. The smoothed seasonally adjusted version of the unemployment rate rose only very modestly to 6.3% from 6.2%.

While UK retail sales were much stronger than expected in March, rising 6.7% y/y and 1.1% m/m, GBP was almost unaffected. Some suspicion that the data is distorted by Brexit, Easter or weather, but GBP market also focused on Brexit more than data. GBP/USD dragged down by weak EUR/USD.

US and Canadian retail sales were both stronger than expected, and while the market response was modest, this provided support for both currencies against the EUR and GBP. EUR/USD touched 1.1225, GBP/USD below 1.30. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

BONDS

Further UST short covering o/n after 10s rejected the attempted drive through 2.59/6%. European morning data & bid cemented that. Strong retail sales & claims data couldn't dent with market already in pre-holiday squaring. US10s stayed pinned back to 2.55/54% pullback support. 2s -2.0bps @ 2.38%, 5s -3.2bps @ 2.37%, 10s -3.4bps @ 2.56%, 30s -3.3bps @ 2.96%.

Agency Spreads: Freddie/Fannie 5s 0.0/+0.1 bps, 10s +0.2/-0.8 bps.

Swap Spreads: 2s -0.47bps, 5s -0.18bps, 10s -0.13bps.

EQUITIES

Equities picked up ahead of the Easter break, more on positive earnings data in the industrial sector than upbeat economic data. Industrials led the gains with a subdued picture elsewhere, energy and financials slipping.

ASIA CURRENCIES

USD/CNY: 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. Upbeat China growth numbers are weakening the case for more stimulus. On Friday, PBoC fixed mid-point at 6.7043 vs. previous close of 6.7085. Onshore spot traded close to 6.7050 levels, remaining far from the lows of 6.6850-levels seen earlier in the week on China GDP beat. For USD/CNY, the next support (we estimate at 6.6700 handle) will likely be broken more from trade news than from fundamentals.

USD/CNH: Pair remained above the key 6.7000 handle on Friday, trading on either side of 6.7050 after touching highs of 6.7100+ earlier on Thursday. A break of the prior range above 6.7000 figure places emphasis on the technical support of 6.6694. This will likely be driven by further breakthrough in US-China trade talks.

USD/SGD: Pair retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. Focus for the week ahead will be on Singapore's March CPI, March industrial production and Q1 unemployment rate. We expect pair to break the 1.3553 resistance, which will turn our attention to the 1.3581 resistance next.

USD/IDR: 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. Onshore markets remained closed on Friday for Good Friday. We expect 13890 support to stand firm for now until the Jokowi victory is confirmed.

USD/INR: 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets. Onshore markets remained closed on Friday for Good Friday. We expect 69.8000 resistance area to continue to stand strong despite the election uncertainties, even as the downside below 68.5000 is also shallow.

DATA RELEASES DUE TODAY

n/a GMT - TH: Customs Exports (Mar) 4cast: % y/y (Mkt: -4.25 Prev: 5.91)

n/a GMT - TH: Customs Imports (Mar) [Mkt: -3, Prev: -10.03]

n/a GMT - TH: Customs Trade Balance (Mar) [Mkt: 750, Prev: 4034]

08:00 GMT - TW: Unemployment (Mar) 4cast: % (Mkt: Prev: 3.71)

14:00 GMT - US: Existing Home Sales (Mar) 4cast: 5.3mn (Mkt: 5.28 Prev: 5.51)

EVENTS & AUCTIONS

- 16:30 GMT - US: 3mth Bills Auction

- 16:30 GMT - US: 6mth Bills Auction


Forex - Asia Open - Overnight Highlights


 23:18 (GMT) 21 Apr

 [Forex Highlights]

Asia Overnight Highlights - 22 April 2019

ASIA OUTLOOK

Weak European and to a lesser extent strong US data weighed on EUR/USD, while GBP/USD fell despite firm UK data. US equities had a more positive day, but despite this and firm US data, UST yields fell.

Majors FX Highlights

The Bloomberg dollar spot index steadied around 97.350 on Friday with most markets closed for Good Friday. This was after hitting a 2.5-week highs of 97.485 on Thursday as US retail sales supported sentiment. Some risk aversion may be seen in the Asian hours today after the blasts in Sri Lanka on Sunday, but liquidity is likely to be thin as Europe is generally closed for Easter Monday.

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1230. GBP however shrugged off the upbeat UK retail sales and dropped to 1.3000-handle. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

Majors Data Highlights

Strong data from the US, Mar retail sales +1.6%, 1.2% ex autos and 0.9% ex auto and gas, regaining momentum after a weak Feb and leaving Q1 looking less weak, further supporting the Q1 GDP picture. This comes alongside a further low in initial claims of 192k, coming in the payroll survey week and implying a strong rise in Apr. This outweighs a modest slowing in Apr's Philly Fed to a still positive 8.5 from Mar's 13.7. Starts and permits disappoint in Mar, underperforming other recent housing sector signals. The flash April EZ composite PMI survey fell to 51.3 from 51.6 in March. The manufacturing corrected marginally higher to 47.8 (prev: 47.5) while the services sector fell to 52.5 (prev: 53.3). UK retail sales continued to surprise to the upside in this March update, with a jump of 1.2% m/m, ie a third successive rise.

Today's data focus in the US will be on existing home sales, which should correct lower after strong Feb gains. Easter Day is celebrated in many countries across the world.

Emerging Asia FX Highlights

USD/Asians traded mostly in a range-bound manner as most markets remained closed on Friday. USD/CNY 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. USD/SGD retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. USD/IDR 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. USD/INR 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets.

Emerging Asia Data Highlights

Last week, the Bank of Korea kept interest rates unchanged. Focus today on Thailand's March customs trade data, as no other tier 1 data is due.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar retail sales +1.6% vs 1.0% exp, ex autos +1.2% vs 0.7% exp.

- US Apr Philly Fed fell to 8.5 from 13.7 vs 11.0 exp.

- US initial claims fell to 192k from 197k vs 205k exp.

- US Feb business inventories +0.3% as exp.

- VIX index: 12.09 (-4.05%)

- Gold Spot: $1,275.39/oz (-0.03%)

- ICE Brent front contract: $71.97 (+$0.35)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.13 (+0.28%)

- 10y UST: 2.560% (0bp) (Asia morning)

- DJI: 26,559.54 (+0.42%); S&P: 2,905.03 (+0.16%); Nasdaq: 7,998.06 (+0.02%)

ASIA NEWS

China: The current reserve requirement ratio is "basically appropriate" as most Chinese economic indicators have improved and market liquidity is at "reasonable level," former PBOC official Sheng Songcheng writes in an article in Economic Information Daily. - BBG

Indonesia: Prabowo Subianto claimed victory for a third day in Indonesia's presidential election, dismissing unofficial quick counts showing a win for incumbent leader Joko Widodo. - BBG

India: Worries of a slowdown in the world's fastest-growing major economy dominated the thoughts of India's monetary policy makers, the minutes of their latest meeting show, suggesting that chances of another interest rate cut in the coming months are very much alive. - BBG

CURRENCIES

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1250. EUR/CHF also fell sharply on the data, but corrected later in the day.

EUR/SEK rose sharply in response to the higher than expected Swedish unemployment rate, though the rise in reality looks likely to be erratic. The smoothed seasonally adjusted version of the unemployment rate rose only very modestly to 6.3% from 6.2%.

While UK retail sales were much stronger than expected in March, rising 6.7% y/y and 1.1% m/m, GBP was almost unaffected. Some suspicion that the data is distorted by Brexit, Easter or weather, but GBP market also focused on Brexit more than data. GBP/USD dragged down by weak EUR/USD.

US and Canadian retail sales were both stronger than expected, and while the market response was modest, this provided support for both currencies against the EUR and GBP. EUR/USD touched 1.1225, GBP/USD below 1.30. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

BONDS

Further UST short covering o/n after 10s rejected the attempted drive through 2.59/6%. European morning data & bid cemented that. Strong retail sales & claims data couldn't dent with market already in pre-holiday squaring. US10s stayed pinned back to 2.55/54% pullback support. 2s -2.0bps @ 2.38%, 5s -3.2bps @ 2.37%, 10s -3.4bps @ 2.56%, 30s -3.3bps @ 2.96%.

Agency Spreads: Freddie/Fannie 5s 0.0/+0.1 bps, 10s +0.2/-0.8 bps.

Swap Spreads: 2s -0.47bps, 5s -0.18bps, 10s -0.13bps.

EQUITIES

Equities picked up ahead of the Easter break, more on positive earnings data in the industrial sector than upbeat economic data. Industrials led the gains with a subdued picture elsewhere, energy and financials slipping.

ASIA CURRENCIES

USD/CNY: 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. Upbeat China growth numbers are weakening the case for more stimulus. On Friday, PBoC fixed mid-point at 6.7043 vs. previous close of 6.7085. Onshore spot traded close to 6.7050 levels, remaining far from the lows of 6.6850-levels seen earlier in the week on China GDP beat. For USD/CNY, the next support (we estimate at 6.6700 handle) will likely be broken more from trade news than from fundamentals.

USD/CNH: Pair remained above the key 6.7000 handle on Friday, trading on either side of 6.7050 after touching highs of 6.7100+ earlier on Thursday. A break of the prior range above 6.7000 figure places emphasis on the technical support of 6.6694. This will likely be driven by further breakthrough in US-China trade talks.

USD/SGD: Pair retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. Focus for the week ahead will be on Singapore's March CPI, March industrial production and Q1 unemployment rate. We expect pair to break the 1.3553 resistance, which will turn our attention to the 1.3581 resistance next.

USD/IDR: 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. Onshore markets remained closed on Friday for Good Friday. We expect 13890 support to stand firm for now until the Jokowi victory is confirmed.

USD/INR: 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets. Onshore markets remained closed on Friday for Good Friday. We expect 69.8000 resistance area to continue to stand strong despite the election uncertainties, even as the downside below 68.5000 is also shallow.

DATA RELEASES DUE TODAY

n/a GMT - TH: Customs Exports (Mar) 4cast: % y/y (Mkt: -4.25 Prev: 5.91)

n/a GMT - TH: Customs Imports (Mar) [Mkt: -3, Prev: -10.03]

n/a GMT - TH: Customs Trade Balance (Mar) [Mkt: 750, Prev: 4034]

08:00 GMT - TW: Unemployment (Mar) 4cast: % (Mkt: Prev: 3.71)

14:00 GMT - US: Existing Home Sales (Mar) 4cast: 5.3mn (Mkt: 5.28 Prev: 5.51)

EVENTS & AUCTIONS

- 16:30 GMT - US: 3mth Bills Auction

- 16:30 GMT - US: 6mth Bills Auction


Forex - Asia Open - Overnight Highlights


 23:18 (GMT) 21 Apr

 [Forex Highlights]

Asia Overnight Highlights - 22 April 2019

ASIA OUTLOOK

Weak European and to a lesser extent strong US data weighed on EUR/USD, while GBP/USD fell despite firm UK data. US equities had a more positive day, but despite this and firm US data, UST yields fell.

Majors FX Highlights

The Bloomberg dollar spot index steadied around 97.350 on Friday with most markets closed for Good Friday. This was after hitting a 2.5-week highs of 97.485 on Thursday as US retail sales supported sentiment. Some risk aversion may be seen in the Asian hours today after the blasts in Sri Lanka on Sunday, but liquidity is likely to be thin as Europe is generally closed for Easter Monday.

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1230. GBP however shrugged off the upbeat UK retail sales and dropped to 1.3000-handle. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

Majors Data Highlights

Strong data from the US, Mar retail sales +1.6%, 1.2% ex autos and 0.9% ex auto and gas, regaining momentum after a weak Feb and leaving Q1 looking less weak, further supporting the Q1 GDP picture. This comes alongside a further low in initial claims of 192k, coming in the payroll survey week and implying a strong rise in Apr. This outweighs a modest slowing in Apr's Philly Fed to a still positive 8.5 from Mar's 13.7. Starts and permits disappoint in Mar, underperforming other recent housing sector signals. The flash April EZ composite PMI survey fell to 51.3 from 51.6 in March. The manufacturing corrected marginally higher to 47.8 (prev: 47.5) while the services sector fell to 52.5 (prev: 53.3). UK retail sales continued to surprise to the upside in this March update, with a jump of 1.2% m/m, ie a third successive rise.

Today's data focus in the US will be on existing home sales, which should correct lower after strong Feb gains. Easter Day is celebrated in many countries across the world.

Emerging Asia FX Highlights

USD/Asians traded mostly in a range-bound manner as most markets remained closed on Friday. USD/CNY 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. USD/SGD retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. USD/IDR 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. USD/INR 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets.

Emerging Asia Data Highlights

Last week, the Bank of Korea kept interest rates unchanged. Focus today on Thailand's March customs trade data, as no other tier 1 data is due.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar retail sales +1.6% vs 1.0% exp, ex autos +1.2% vs 0.7% exp.

- US Apr Philly Fed fell to 8.5 from 13.7 vs 11.0 exp.

- US initial claims fell to 192k from 197k vs 205k exp.

- US Feb business inventories +0.3% as exp.

- VIX index: 12.09 (-4.05%)

- Gold Spot: $1,275.39/oz (-0.03%)

- ICE Brent front contract: $71.97 (+$0.35)

- Nymex WTI front contract: $64.00 (+$0.24)

- Reuters/Jefferies Commodities Index: 187.13 (+0.28%)

- 10y UST: 2.560% (0bp) (Asia morning)

- DJI: 26,559.54 (+0.42%); S&P: 2,905.03 (+0.16%); Nasdaq: 7,998.06 (+0.02%)

ASIA NEWS

China: The current reserve requirement ratio is "basically appropriate" as most Chinese economic indicators have improved and market liquidity is at "reasonable level," former PBOC official Sheng Songcheng writes in an article in Economic Information Daily. - BBG

Indonesia: Prabowo Subianto claimed victory for a third day in Indonesia's presidential election, dismissing unofficial quick counts showing a win for incumbent leader Joko Widodo. - BBG

India: Worries of a slowdown in the world's fastest-growing major economy dominated the thoughts of India's monetary policy makers, the minutes of their latest meeting show, suggesting that chances of another interest rate cut in the coming months are very much alive. - BBG

CURRENCIES

EUR/USD fell sharply in response to weaker than expected Eurozone PMI data. The initial decline came after weaker than expected German manufacturing PMI numbers, but the Eurozone total composite index was also weaker than expected, reflecting weakness in EU services ex-France and Germany, and this pushed the EUR on a second leg lower to test 1.1250. EUR/CHF also fell sharply on the data, but corrected later in the day.

EUR/SEK rose sharply in response to the higher than expected Swedish unemployment rate, though the rise in reality looks likely to be erratic. The smoothed seasonally adjusted version of the unemployment rate rose only very modestly to 6.3% from 6.2%.

While UK retail sales were much stronger than expected in March, rising 6.7% y/y and 1.1% m/m, GBP was almost unaffected. Some suspicion that the data is distorted by Brexit, Easter or weather, but GBP market also focused on Brexit more than data. GBP/USD dragged down by weak EUR/USD.

US and Canadian retail sales were both stronger than expected, and while the market response was modest, this provided support for both currencies against the EUR and GBP. EUR/USD touched 1.1225, GBP/USD below 1.30. USD/CAD found sellers at 1.34 and AUD/CAD moved back below .96. USD/JPY saw a spike up to 112.07 on the US data, but that proved to be the day's high.

BONDS

Further UST short covering o/n after 10s rejected the attempted drive through 2.59/6%. European morning data & bid cemented that. Strong retail sales & claims data couldn't dent with market already in pre-holiday squaring. US10s stayed pinned back to 2.55/54% pullback support. 2s -2.0bps @ 2.38%, 5s -3.2bps @ 2.37%, 10s -3.4bps @ 2.56%, 30s -3.3bps @ 2.96%.

Agency Spreads: Freddie/Fannie 5s 0.0/+0.1 bps, 10s +0.2/-0.8 bps.

Swap Spreads: 2s -0.47bps, 5s -0.18bps, 10s -0.13bps.

EQUITIES

Equities picked up ahead of the Easter break, more on positive earnings data in the industrial sector than upbeat economic data. Industrials led the gains with a subdued picture elsewhere, energy and financials slipping.

ASIA CURRENCIES

USD/CNY: 1Y NDFs mostly hovered around the highs of 6.7500 on Friday after reaching the levels in Thursday's NY hours. Upbeat China growth numbers are weakening the case for more stimulus. On Friday, PBoC fixed mid-point at 6.7043 vs. previous close of 6.7085. Onshore spot traded close to 6.7050 levels, remaining far from the lows of 6.6850-levels seen earlier in the week on China GDP beat. For USD/CNY, the next support (we estimate at 6.6700 handle) will likely be broken more from trade news than from fundamentals.

USD/CNH: Pair remained above the key 6.7000 handle on Friday, trading on either side of 6.7050 after touching highs of 6.7100+ earlier on Thursday. A break of the prior range above 6.7000 figure places emphasis on the technical support of 6.6694. This will likely be driven by further breakthrough in US-China trade talks.

USD/SGD: Pair retreated slightly from the highs of 1.3565 printed in Thursday's NY hours and entered consolidation around 1.3555 subsequently on Friday as onshore markets remained closed for Good Friday. Focus for the week ahead will be on Singapore's March CPI, March industrial production and Q1 unemployment rate. We expect pair to break the 1.3553 resistance, which will turn our attention to the 1.3581 resistance next.

USD/IDR: 1M NDFs traded close to 14100-levels on Friday after bidding up from Thursday's early lows of 14040 which were seen as quick counts suggested a Jokowi victory. Onshore markets remained closed on Friday for Good Friday. We expect 13890 support to stand firm for now until the Jokowi victory is confirmed.

USD/INR: 1M NDFs traded quietly around 69.7500 late on Thursday and Friday as liquidity was thin in the markets. Onshore markets remained closed on Friday for Good Friday. We expect 69.8000 resistance area to continue to stand strong despite the election uncertainties, even as the downside below 68.5000 is also shallow.

DATA RELEASES DUE TODAY

n/a GMT - TH: Customs Exports (Mar) 4cast: % y/y (Mkt: -4.25 Prev: 5.91)

n/a GMT - TH: Customs Imports (Mar) [Mkt: -3, Prev: -10.03]

n/a GMT - TH: Customs Trade Balance (Mar) [Mkt: 750, Prev: 4034]

08:00 GMT - TW: Unemployment (Mar) 4cast: % (Mkt: Prev: 3.71)

14:00 GMT - US: Existing Home Sales (Mar) 4cast: 5.3mn (Mkt: 5.28 Prev: 5.51)

EVENTS & AUCTIONS

- 16:30 GMT - US: 3mth Bills Auction

- 16:30 GMT - US: 6mth Bills Auction


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