Forex - Asia Open - Overnight Highlights


 00:29 (GMT) 12 Aug

  [Forex Highlights]

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

Asia Overnight Highlights - 12 Aug 2019

MAJORS

FX Highlights:

The USD has recovered after a temporary dip last Friday. USD/JPY saw a low of 105.25 but EUR/USD saw only modest gains to around 1.1220, Italian political risks persisting. A report that a Trump remark on not doing business with Huawei referred only to the Federal government saw equities and the USD move off the lows.
EUR/CHF kept to a tight range near 1.09. The NOK managed a modest recovery after stronger than expected CPI data, and the SEK also rallied, though the EUR corrected some of its losses against both later.
USD/CAD bounced to 1.3274 on a decline in Canadian employment, but with wages firmer and oil up the bounce was fully erased. The equity slide saw a modest bounce to around 1.3245 before slipping back near 1.32. AUD was subdued, with AUD/CAD unable to hold above .90.

Data/Events Highlights:

- US Jul PPI +0.2% as exp, ex food and energy -0.1% vs +0.2% exp.

- Canada Jul employment -24.2k vs +15k exp, unemployment rose to 5.7% from 5.5% vs 5.5% exp, hourly wages to 4.5% yr/yr from 3.6% vs 3.8% exp.

- Japan's economy grew 1.8% q/q SAAR and 0.4% q/q in Q2 according to advance estimates. This performance is modest but not too bad compared to that of Q1. This bettered market expectations. Growth was supported by domestic demand even though export growth was weak.

-Q2 UK GDP unexpectedly fell by 0.2%, below market expectations of no change. The decline was due primarily to weakness in manufacturing output, which itself likely reflected destocking after the inventory build in Q1 which anticipated Brexit.

- VIX index: 17.97 (+6.27%)

- Gold Spot: $1,499.36/oz (+0.47%)

- ICE Brent front contract: $58.21 ($-0.32)

- Nymex WTI front contract: $54.21 ($-0.29)

- Reuters/Jefferies Commodities Index: 172.09 (+1.04%)

- 10y UST: 1.745% (+3bp) (Asia morning)

- DJI: 26,287.44 (-0.34%); S&P: 2,918.65 (-0.66%); Nasdaq: 7,959.14 (-1.00%)

Data/Events Ahead:

A quiet day ahead in terms of data releases.

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

EMERGING ASIA

FX Highlights:

Asian currencies had a cautious start to the new week. Signs of further escalation of US-China trade war still weighed on markets. Currency movements in the region are limited as several markets are closed for holiday.

USD/CNH was consolidative around 7.1000 as the new week started. Trade concerns still weighed on markets. Although unlikely for now, a breach of the 7.1400 high on 6 August could prompt further move towards the 7.2000 big figure. 1Y NDFs eased slightly to 7.1400 at last look. Markets have priced chances of no trade deal and are now stabilising on China policy consistency. For USD/CNY, a move above 7.0500 big figure will next have markets testing 7.0670 resistance.

USD/SGD extended gains after the new week started, and was seen at a high of 1.3880. Trade actions taken by both U.S. and China, along with the Fed's decision, will continue to drive future price action. Focus for the week ahead will be on Singapore's Q2 GDP final print on Tuesday. We expect Q2 GDP to be revised down to 0.0% y/y from 0.1% y/y. Break of 1.3873 resistance turn our attention to the 1.3889 resistance next.

USD/IDR 1M NDFs rebounded slightly to 14300 Friday night, and was seen lower to 14283 at last look. The onshore spot inched lower to 14200 last Friday. For USD/IDR, 14122 support likely to hold and some vulnerability towards 14360 resistance should persist.

Onshore USD/INR recovered somewhat after hitting a low of 70.450 last Friday, and closed at 70.800. Pair will likely continue to be affected by US-China trade tensions and domestic Kashmir volatility. Pair will need to lift above 71.000 to resume upmove.1M NDFs still held onto gains, and were trading at 70.320 into Asia hours on Monday.

Data/Events Highlights:

A bad set for China price data last Friday. Inflation climbed further to 2.8% y/y even as market expectations were for some stability. This also meant 0.4% m/m increase (we were expecting none). Food inflation remains a major concern - it climbed a staggering 9.1% y/y in July. Meanwhile PPI fell 0.3% y/y, the first since August 2016. This is bad for factory profits. Malaysia industrial production eased slightly to 3.9% y/y in June from 4.0% y/y prior. India industrial production also came in weaker in June, at 2.0% y/y from 4.6% y/y in May.

Data/Events Ahead:

No key data releases due in the day ahead as several markets are closed for holiday.

DATA RELEASES DUE TODAY

- 18:00 GMT / 02:00 SGT - US: Monthly Budget Statement (Jul) [Mkt: -111, Prev: -8.5]

- 23:50 GMT / 07:50 SGT - JP: PPI (Jul) [Mkt: 0.1, Prev: -0.5]

- 23:50 GMT / 07:50 SGT - JP: PPI (Jul) [Mkt: -0.5, Prev: -0.1]

EVENTS & AUCTIONS

- IN/PH: Market Holiday - Eid al-Adha

-MY/ SG: Market Holiday - Hari Raya Haji

-TH: Market Holiday - Queen Mother's Birthday

15:30 GMT / 23:30 SGT - US: 3mth Bills Auction (USD 42bln)

15:30 GMT / 23:30 SGT - US: 6mth Bills Auction (USD 42bln)

22:00 GMT / 06:00 SGT - AU: RBA's Kent speaks in Sydney


Forex - Philippines Flows: Peso supported by China stability


 04:12 (GMT) 09 Aug

 [Forex Flows]

USD/PHP gapped lower and stayed there, last at 51.934. This comes as DXY remains relatively range bound and markets digested BSP's rate cut and thoughts on further easing. GDP growth slowdown did not further impact on the peso, as it is likely helped by China's stable CNY fixing prints in recent days. Support of 51.88 and 51.55 next levels to watch. 1M NDF last at 52.02. PSEI up 0.16% on similar trends with FX.


Forex - REVIEW- Philippines Q2 GDP growth missed expectations, eased to a 4-year low


 02:26 (GMT) 08 Aug

 [Economic Data]

The Philippines economy slowed down further in the second quarter. Q2 GDP missed market expectations and rose by only 5.5% y/y, the lowest in about four years. Government spending growth remained soft, as impact of delay in budget approval dragged on. Gross fixed capital extended the downtrend, and fell by 4.5% y/y in Q2 following a rise of 6.4% y/y in Q1. Export growth slowed down further to 4.4% y/y, while import growth was flat.

Disappointing Q2 growth added to economic growth concerns in the Philippines. Bangko Sentral ng Pilipinas (BSP) will announce policy decision later today, with a 25-bps reduction already seen by the markets. However, the recent turn of events such as escalating US-China trade war and prospect of further easing by the Fed have increased the odds of more easing by the Bank. We think that bigger cut such as a 50 bps rate cut is also not ruled out.


Forex - Indonesia Chart JAKARTA Comp Update: Sustaining bounce from the 6023 low


 02:25 (GMT) 08 Aug

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Forex - Chart USD/INR Update: Focus stays on the upside


 04:19 (GMT) 07 Aug

 [Forex Charts]

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Forex - Flows: Net Foreign Equity Flows on Tue


 01:17 (GMT) 07 Aug

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Forex - Flows: Net Foreign Equity Flows on Tue


 01:17 (GMT) 07 Aug

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Forex - Flows: Net Foreign Equity Flows on Tue


 01:17 (GMT) 07 Aug

Please view the story for more information...


Forex - Flows: Net Foreign Equity Flows on Tue


 01:17 (GMT) 07 Aug

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Forex - Asia Open - Overnight Highlights


 23:49 (GMT) 05 Aug

 [Forex Highlights]

Asia Overnight Highlights - 6 Aug 2019

MAJORS

FX Highlights:

The Bloomberg dollar spot index saw a bearish tone overnight on Monday following heightened tensions between US and China with currency manipulation being added as a tool in the trade war fight. Weak services ISM print also weighed.

The European morning saw EUR/USD rise above 1.1150 for the first time since before the FOMC meeting, pushing above 1.12 in North America and printing fresh highs of 1.1236 in early Asian trading after US Treasury labeled China a currency manipulator.

CHF was the best performer in early Europe, with EUR/CHF hitting a new 2 year low at 1.0865 before returning to around 1.09. GBP weakened against the EUR with EUR/GBP touching a new 2 year high at 0.9240, but dips in GBP/USD found buyers, Cable sticking to the 1.21 handle.

USD/JPY recovered slightly from the lows seen in Asia, pushing back above 106, comments from MoF's Takeuchi that the FX market was being watched noted. Another drop to 105.52 however followed earlier this morning.

USD/CAD slipped as oil came off its lows but was unable to hold below 1.32. AUD/USD held above Asian lows but failed to move above .6785. NZD/USD rocketed by over 50 pips to about 0.6587 on upbeat Q2 labour market data which saw unemployment rate drop to 3.9% from 4.3%.

Data/Events Highlights:

- US Jul ISM non-manufacturing index fell to 53.7 from 55.1 vs 55.5 exp.

- Fed Senior Loan Officer Survey shows improved demand for mortgage and consumer loans, less negative demand for C+I and commercial real estate loans, supply conditions on balance little changed.

- European PMIs were mixed with upward revisions in French and Italian services offset by a downward revision to Germany. Eurozone composite PMI was unrevised at 51.5. UK services PMI stronger than expected at 51.4. Swedish services PMI recovered to 52.3 in July from 49.4 in June. The Eurozone Sentix index of investor sentiment fell to -13.7 in August from -5.8 in July, lowest since October 2014. The ECB bulletin said any recovery in trade is likely to be mild due to a subdued investment outlook.

- UK July services PMI numbers, with a surprise rise of 1.2 points to 51.4, more than repaired the drop seen in June.

- VIX index: 24.59 (+39.64%)

- Gold Spot: $1,472.56/oz (+0.60%)

- ICE Brent front contract: $59.81 ($-2.08)

- Nymex WTI front contract: $54.19 ($-0.50)

- Reuters/Jefferies Commodities Index: 171.49 (-1.08%)

- 10y UST: 1.708% (-14bp) (Asia morning)

- DJI: 25,717.74 (-2.90%); S&P: 2,844.74 (-2.98%); Nasdaq: 7,726.04 (-3.47%)

Data/Events Ahead:

German Factory orders for June will be released, where we look for a 0.8% m/m rise following a sharp 2.2% m/m fall in May.

Japan's June household spending and labor earnings data is also due.

EMERGING ASIA

FX Highlights:

China's weak PBOC fixing rattled Asian currencies on Monday. Markets are concerned that trade wars are spilling over to currency wars. U.S.' overnight move to label China as a currency manipulator aided further risk aversion. CNH (-1.73%) and CNY (-1.56%) saw heavy losses. INR (-1.59%) was also pressured by Kashmir tensions. KRW (-1.40%), TWD (-0.78%), PHP (-0.67%), SGD (-0.53%), IDR (-0.49%) and MYR (-0.47%) - all were in the red against the greenback.

USD/CNH broke the 7 handle on Monday in the Asian hours and rose further to 7.1400 early this morning after US labeled China as a currency manipulator. Pair now in unchartered territory. 1Y NDFs likewise extended Monday's gains to 7.1800 in early Tuesday hours. USD/CNY onshore spot gapped higher on Monday and traded to fresh record highs of 7.0548. Eyes on a break above 7.1000 following USD/CNH.

USD/SGD also extended gains as trade war concerns ramped up, and a break of 1.3850 was seen in early trading on Tuesday. Pair printed fresh 9-month highs1.3869 being one of the most trade open economies in the region. Expect a break of 1.3873 resistance as Asian traders come online to the news of China being called out a currency manipulator.

USD/IDR 1M NDFs maintained a bullish bias, and rose to 14550+ levels from sub-14350 levels seen earlier on Monday. Onshore spot moved higher to 14250+ levels and extended gains to fresh 6-week highs of 14280 in the afternoon. Q2 GDP release was in-line with expectations, and paved way for further BI easing. Eyes are on a break above 14300, but intervention may delay the move to 14500.

USD/INR 1M NDFs broke above 71.500 in Monday's NY session - rising 1 big figure since the start of the week. Onshore spot gapped higher to open above the 70 handle on Monday at 70.145 from Friday's close of 69.5850 and rose to 5-month highs of 70.740 amid heightened Kashmir tensions. Global events also weighed on the rupee with China letting the yuan cross the 7/USD mark, suggesting currency manipulation would be added as a trade war tactic. The announcement of scrapping of Article 370 weighed on rupee, but intervention halted further highs in USD/INR. Focus now on the RBI meeting this week, where another rate cut is likely. Any further escalations could prompt a test of the 71 handle.

Data/Events Highlights:

Indonesia's Q2 GDP came in line with expectations at 5.05% y/y, and we believe BI will ease more to support growth.

Data/Events Ahead:

Philippines' July CPI will be watched closely ahead of the BSP decision later this week. Taiwan's July CPI is also due in the afternoon.

DATA RELEASES DUE TODAY

- 01:00 GMT / 09:00 SGT - PH: CPI (Jul) 4cast:2.5 % y/y [Mkt: 2.4, Prev: 2.7]

- 01:30 GMT / 09:30 SGT - AU: Trade Balance (Jun) 4cast:5658 AUD mn [Mkt: 6000, Prev: 5745]

- 04:30 GMT / 12:30 SGT - AU: RBA - Cash Rate Target (Aug 6) 4cast:1 % [Mkt: 1, Prev: 1]

- 08:00 GMT / 16:00 SGT - TW: CPI (Jul) % y/y [Mkt: 0.79, Prev: 0.86]

EVENTS & AUCTIONS

03:35 GMT / 11:35 SGT - JP: 30 yr Bonds Auction

09:30 GMT / 17:30 SGT - EU: ECB Main Refinancing Operation Result

10:30 GMT / 18:30 SGT - UK: 2025 0.625% Conventional Gilt Auction (GBP 3bln)

14:05 GMT / 22:05 SGT - US: Fed's Harker speaks in Philadelphia

16:00 GMT / 00:00 SGT - US: Fed's Bullard speaks on economy

17:00 GMT / 01:00 SGT - US: 3yr Note Auction (USD 38bln)

23:50 GMT / 07:50 SGT - JP: BoJ's summary of opinions


Forex - Asia Open - Overnight Highlights


 23:49 (GMT) 05 Aug

 [Forex Highlights]

Asia Overnight Highlights - 6 Aug 2019

MAJORS

FX Highlights:

The Bloomberg dollar spot index saw a bearish tone overnight on Monday following heightened tensions between US and China with currency manipulation being added as a tool in the trade war fight. Weak services ISM print also weighed.

The European morning saw EUR/USD rise above 1.1150 for the first time since before the FOMC meeting, pushing above 1.12 in North America and printing fresh highs of 1.1236 in early Asian trading after US Treasury labeled China a currency manipulator.

CHF was the best performer in early Europe, with EUR/CHF hitting a new 2 year low at 1.0865 before returning to around 1.09. GBP weakened against the EUR with EUR/GBP touching a new 2 year high at 0.9240, but dips in GBP/USD found buyers, Cable sticking to the 1.21 handle.

USD/JPY recovered slightly from the lows seen in Asia, pushing back above 106, comments from MoF's Takeuchi that the FX market was being watched noted. Another drop to 105.52 however followed earlier this morning.

USD/CAD slipped as oil came off its lows but was unable to hold below 1.32. AUD/USD held above Asian lows but failed to move above .6785. NZD/USD rocketed by over 50 pips to about 0.6587 on upbeat Q2 labour market data which saw unemployment rate drop to 3.9% from 4.3%.

Data/Events Highlights:

- US Jul ISM non-manufacturing index fell to 53.7 from 55.1 vs 55.5 exp.

- Fed Senior Loan Officer Survey shows improved demand for mortgage and consumer loans, less negative demand for C+I and commercial real estate loans, supply conditions on balance little changed.

- European PMIs were mixed with upward revisions in French and Italian services offset by a downward revision to Germany. Eurozone composite PMI was unrevised at 51.5. UK services PMI stronger than expected at 51.4. Swedish services PMI recovered to 52.3 in July from 49.4 in June. The Eurozone Sentix index of investor sentiment fell to -13.7 in August from -5.8 in July, lowest since October 2014. The ECB bulletin said any recovery in trade is likely to be mild due to a subdued investment outlook.

- UK July services PMI numbers, with a surprise rise of 1.2 points to 51.4, more than repaired the drop seen in June.

- VIX index: 24.59 (+39.64%)

- Gold Spot: $1,472.56/oz (+0.60%)

- ICE Brent front contract: $59.81 ($-2.08)

- Nymex WTI front contract: $54.19 ($-0.50)

- Reuters/Jefferies Commodities Index: 171.49 (-1.08%)

- 10y UST: 1.708% (-14bp) (Asia morning)

- DJI: 25,717.74 (-2.90%); S&P: 2,844.74 (-2.98%); Nasdaq: 7,726.04 (-3.47%)

Data/Events Ahead:

German Factory orders for June will be released, where we look for a 0.8% m/m rise following a sharp 2.2% m/m fall in May.

Japan's June household spending and labor earnings data is also due.

EMERGING ASIA

FX Highlights:

China's weak PBOC fixing rattled Asian currencies on Monday. Markets are concerned that trade wars are spilling over to currency wars. U.S.' overnight move to label China as a currency manipulator aided further risk aversion. CNH (-1.73%) and CNY (-1.56%) saw heavy losses. INR (-1.59%) was also pressured by Kashmir tensions. KRW (-1.40%), TWD (-0.78%), PHP (-0.67%), SGD (-0.53%), IDR (-0.49%) and MYR (-0.47%) - all were in the red against the greenback.

USD/CNH broke the 7 handle on Monday in the Asian hours and rose further to 7.1400 early this morning after US labeled China as a currency manipulator. Pair now in unchartered territory. 1Y NDFs likewise extended Monday's gains to 7.1800 in early Tuesday hours. USD/CNY onshore spot gapped higher on Monday and traded to fresh record highs of 7.0548. Eyes on a break above 7.1000 following USD/CNH.

USD/SGD also extended gains as trade war concerns ramped up, and a break of 1.3850 was seen in early trading on Tuesday. Pair printed fresh 9-month highs1.3869 being one of the most trade open economies in the region. Expect a break of 1.3873 resistance as Asian traders come online to the news of China being called out a currency manipulator.

USD/IDR 1M NDFs maintained a bullish bias, and rose to 14550+ levels from sub-14350 levels seen earlier on Monday. Onshore spot moved higher to 14250+ levels and extended gains to fresh 6-week highs of 14280 in the afternoon. Q2 GDP release was in-line with expectations, and paved way for further BI easing. Eyes are on a break above 14300, but intervention may delay the move to 14500.

USD/INR 1M NDFs broke above 71.500 in Monday's NY session - rising 1 big figure since the start of the week. Onshore spot gapped higher to open above the 70 handle on Monday at 70.145 from Friday's close of 69.5850 and rose to 5-month highs of 70.740 amid heightened Kashmir tensions. Global events also weighed on the rupee with China letting the yuan cross the 7/USD mark, suggesting currency manipulation would be added as a trade war tactic. The announcement of scrapping of Article 370 weighed on rupee, but intervention halted further highs in USD/INR. Focus now on the RBI meeting this week, where another rate cut is likely. Any further escalations could prompt a test of the 71 handle.

Data/Events Highlights:

Indonesia's Q2 GDP came in line with expectations at 5.05% y/y, and we believe BI will ease more to support growth.

Data/Events Ahead:

Philippines' July CPI will be watched closely ahead of the BSP decision later this week. Taiwan's July CPI is also due in the afternoon.

DATA RELEASES DUE TODAY

- 01:00 GMT / 09:00 SGT - PH: CPI (Jul) 4cast:2.5 % y/y [Mkt: 2.4, Prev: 2.7]

- 01:30 GMT / 09:30 SGT - AU: Trade Balance (Jun) 4cast:5658 AUD mn [Mkt: 6000, Prev: 5745]

- 04:30 GMT / 12:30 SGT - AU: RBA - Cash Rate Target (Aug 6) 4cast:1 % [Mkt: 1, Prev: 1]

- 08:00 GMT / 16:00 SGT - TW: CPI (Jul) % y/y [Mkt: 0.79, Prev: 0.86]

EVENTS & AUCTIONS

03:35 GMT / 11:35 SGT - JP: 30 yr Bonds Auction

09:30 GMT / 17:30 SGT - EU: ECB Main Refinancing Operation Result

10:30 GMT / 18:30 SGT - UK: 2025 0.625% Conventional Gilt Auction (GBP 3bln)

14:05 GMT / 22:05 SGT - US: Fed's Harker speaks in Philadelphia

16:00 GMT / 00:00 SGT - US: Fed's Bullard speaks on economy

17:00 GMT / 01:00 SGT - US: 3yr Note Auction (USD 38bln)

23:50 GMT / 07:50 SGT - JP: BoJ's summary of opinions


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