Forex - Asia Open - Overnight Highlights


 23:27 (GMT) 22 Apr

  [Forex Highlights]

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

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

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

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.

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

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 Open - Overnight Highlights (0101-KMVP-C02)

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


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 - Chart USD/SGD Update: Sell-off towards closing last session turning pressure towards 1.3518/10 supports


 00:20 (GMT) 18 Apr

 [Forex Charts]

Please view the story for more information...


Forex - Flows: Strong China GDP triggering 1 big figure move downwards for USD/CNH, while USD/CNY also moved lower


 02:19 (GMT) 17 Apr

 [Forex Flows]

USD/CNH saw a sharp move down to 6.7045 from 6.7140. This was propelled by a strong China GDP print: 6.4% y/y vs. our expectations of 6.2%. March numbers look well supported by official stimulus with industrial production (8.5% y/y) seemingly back to 2017 boom numbers. Retail sales also rebounded. The 6.7000 psychological support remains a barrier to the technical support of 6.6694.

PBoC fixed mid-point at 6.7110 vs. previous close of 6.7128. USD/CNY was down to 6.7050 before rebounding to 6.7067. 1Y NDFs similarly followed spot movements down to 6.7444. For USD/CNY, moving below the 6.7000 handle should trigger some profit taking.


Forex - Asia Open - Overnight Highlights


 23:37 (GMT) 14 Apr

 [Forex Highlights]

Asia Overnight Highlights - 15 April 2019

ASIA OUTLOOK

Strong Chinese money supply and credit data, and results from JP Morgan Chase, lifted equities and USD/JPY and had USTs under pressure. AUD/USD was also firm while EUR/JPY buying helped push EUR/USD above 1.13.

Majors FX Highlights

The Bloomberg dollar spot index traded with a downside bias overnight on Friday, dipping to lows of 96.745, as downbeat Michigan consumer confidence did little to support sentiment on the dollar and offset the losses against the euro and sterling. Some recovery to 96.900+ levels was however seen later in the session, but the 97 handle remained intact.

EUR/USD saw a bullish momentum from some positioning and momentum gains, and broke above 1.1300 for the first time since early March, although a return to the big figure was seen in late NY/early Asian hours this morning. GBP/USD played some catch-up in afternoon trading, but failed to hold highs above 1.31. USD/JPY was seen with an upside bent as well, breaking above 112 in late hours as risk sentiment improved with strong earnings and China credit data. AUD/USD also rallied particularly hard on the news, peaking at .7192. USD/CAD fell to 1.3330 levels as rising oil prices supported the loonie.

Majors Data Highlights

US Mar import prices at +0.6% stronger than expected with Feb revised up to 1.0% from 0.6%, gains led by rebound in energy. Eurozone industrial production dropped 0.2 per cent in February from January, reversing a revised 1.9 per cent rise a month earlier, while annually it fell 0.3 per cent. Eurozone industrial production was stronger than expected in February, falling just 0.2% after an upwardly revised January rise of 1.9%.

In the US today, Empire State manufacturing data for Apr is due and late in the day Feb TICS capital flows will be released. Voting Fed dove Evans is due to speak. No other key data on the wires today.

Emerging Asia FX Highlights

USD/Asians traded mostly lower in late NY hours as risk sentiment improved following upbeat China credit data. USD/CNY 1Y NDFs traded lower in late Asian hours after the upbeat exports and credit data supported the sentiment, which saw pair dip from 6.7650 to 6.7405 eventually in NY. USD/SGD was generally seen trading around 1.3560 earlier on Friday but dropped to 1.3525 lows as risk sentiment improved on upbeat China data in the Friday afternoon. USD/IDR 1M NDFs were seen restrained at 14273 highs in the previous week, and dropped sharply to sub-14200 levels on Friday evening, printing lows of 14173. USD/INR 1M NDFs remained above 69.500-levels Friday, shrugging off the market trend for stronger Asian currencies in late Friday hours.

Emerging Asia Data Highlights

Monetary Authority of Singapore (MAS) has maintained its exchange-rate appreciation policy on April 12. MAS now sounds more neutral than it was six months ago. This comes as Singapore's GDP growth slowed to 1.3% y/y in Q1-2019, from 1.9% in Q4-2018. China's March exports jumped by 14.2% y/y while imports fell 7.6% y/y to a wider trade surplus of USD 32.64bn. India's March CPI came broadly in-line with our expectations at 2.86% y/y, although the Feb IP slowed to a 20-month low of 0.1% y/y. China's credit growth exceeded all estimates in March after a slowdown during the Lunar New Year, signaling a further firming of the nascent economic recovery ahead. Aggregate financing was 2.86 trillion yuan ($426 billion) last month, compared with about 700 billion yuan in February. Broad M2 money supply increased 8.6 percent, the fastest pace since February 2018.

Eyes today on trade data from India and Indonesia, and India's March WPI is also due. Philippines' March remittances data may also take some focus.

OVERNIGHT NEWS HIGHLIGHTS

- US Mar import prices +0.6% vs 0.4% exp.

- US Apr preliminary Michigan CSI fell to 96.9 from 98.4 vs 98.2 exp.

- VIX index: 12.01 (-7.76%)

- Gold Spot: $1,291.02/oz (+0.05%)

- ICE Brent front contract: $71.33 ($-0.22)

- Nymex WTI front contract: $63.58 ($-0.31)

- Reuters/Jefferies Commodities Index: 188.36 (+0.55%)

- 10y UST: 2.565% (+7bp) (Asia morning)

- DJI: 26,412.30 (+1.03%); S&P: 2,907.41 (+0.66%); Nasdaq: 7,984.16 (+0.46%)

ASIA NEWS

China: China will maintain a prudent monetary policy stance this year and keep the yuan in line with fundamentals as it uses fiscal tools to spur growth, according to central bank Deputy Governor Chen Yulu. - BBG

China: The U.S. is open to facing "repercussions" if it doesn't live up to its commitments in a potential trade deal with China, Treasury Secretary Steven Mnuchin said, in a sign that the two sides are edging closer to an accord. - BBG

Indonesia: Indonesian President Joko Widodo, bidding for a second five-year term to run the world's largest Muslim-majority nation, arrived in Saudi Arabia for a minor pilgrimage to the holy city of Mecca days before the election. - BBG

India: India's central bank chief said the expansion of the world's fastest-growing major economy needs to pick up to around 8 percent to deal with poverty and other challenges. - BBG

CURRENCIES

The positive bias in EUR/JPY that started in Asia continued in Europe, with EUR/JPY advancing another 50 pips from the European open and EUR/USD breaking above 1.13 for the first time since early March. The EUR/JPY strength in Asia looks to have been triggered by an M&A flow rather than any real news, and the rise in Europe consequently looks to be more about positioning and momentum than a change in market perceptions. But the EUR may also have gained some support from a Thursday report suggesting that the ECB was unlikely to embrace tiering of interest rates to moderate the impact of negative rates on Bank profitability. Eurozone industrial production was also stronger than expected in February, falling just 0.2% after an upwardly revised January rise of 1.9%.

Strong Chinese money and credit data in March helped support risk appetite, after there was little reaction to the mixed Chinese trade numbers. AUD/USD rallied particularly hard on the news, peaking at .7192, while USD/JPY also got a further boost, eventually touching above 112 in North American trade.

GBP underperformed the EUR and AUD, and EUR/GBP traded up to 0.8656, the highest since March 22. GBP/USD played some catch-up in afternoon trading, but failed to hold highs above 1.31.

BONDS

USTs went into Friday looking vulnerable with longs offside and the strong China credit data followed up by JPMorgan earnings beat fueled further bailing, led by the belly as S&P broke out to fresh highs. US5s cleared the 21 Mar + yield range ceiling. A softer UoM confidence, particularly on inflation expectations, slightly stemmed the tide. 2s +3.7bps @ 2.39%, 5s +6.3bps @ 2.37%, 10s +6.1bps @ 2.56%, 30s +4.4bps @ 2.97%.

Agency Spreads: Freddie/Fannie 5s -0.4/-0.7 bps, 10s -1.9/+1.0 bps.

Swap Spreads: 2s +1.28bps, 5s +0.26bps, 10s +0.18bps.

EQUITIES

Strong results from JP Morgan Chase helped financials lead an equity advance, despite Wells Fargo underperforming after their results. Positive Chinese data, money supply and credit more than mixed details on the trade balance, also supported the market.

ASIA CURRENCIES

USD/CNY: 1Y NDFs traded lower in late Asian hours after the upbeat exports and credit data supported the sentiment, which saw pair dip from 6.7650 to 6.7405 eventually in NY. On Friday, PBoC fixed mid-point at 6.7220 vs. previous close of 6.7190. Onshore spot USD/CNY finally broke above the 6.7200 handle, rising to 6.7233 but dropped sharply to 6.7010 in the afternoon. For USD/CNY, 6.7406 resistance should hold in the light of recent stability.

USD/CNH: Pair was held below the 6.7300 handle on Friday and saw a strong downside bias to dip to 6.7050-levels in the NY session as China credit data and a wider trade surplus supported sentiment. The range of 6.7050-6.7319 to hold.

USD/SGD: Pair was generally seen trading around 1.3560 earlier on Friday but dropped to 1.3525 lows as risk sentiment improved on upbeat China data in the Friday afternoon. MAS kept policy settings unchanged as expected by consensus expectations. Statement looked to be neutral at first glance. MAS revised down core inflation forecast by 0.5ppt. Singapore GDP softened in Q1 due to a fall in manufacturing activity. Singapore retail sales also stayed relatively weak. Watch the 1.3615 resistance for signs of more weakness.

USD/IDR: 1M NDFs were seen restrained at 14273 highs in the previous week, and dropped sharply to sub-14200 levels on Friday evening, printing lows of 14173. Onshore spot traded horizontally around 14150 earlier on Friday but a sharp drop to sub-14100 levels was seen into the close. Tensions are likely to pick up in Indonesia this week as elections approach this week. March trade data will be eyed on Monday, but expect FX markets to remain quiet. We expect some stability in the pair ahead of the elections, and key levels at 14255 and 14035 should remain intact.

USD/INR: 1M NDFs remained above 69.500-levels Friday, shrugging off the market trend for stronger Asian currencies in late Friday hours. Onshore spot traded choppily on either side of 69.2000 on Friday. Downside below 68.5000 appears shallow with voting underway. We expect some upside pressures, but the 69.8000 area should cap gains.

DATA RELEASES DUE TODAY

n/a GMT - PH: Overseas Remittances (Feb) 4cast: 3.5% y/y (Mkt: 3.5 Prev: 4.4)

n/a GMT - PH: Overseas Remittances (Feb) USD bn (Prev: 2.484)

n/a GMT - IN: Exports (Mar) 4cast: 3.0% y/y (Prev: 2.4)

n/a GMT - IN: Imports (Mar) 4cast: -7.0% y/y (Prev: -5.4)

n/a GMT - IN: Trade Balance (Mar) 4cast: -9.825USD bn (Mkt: -9.5 Prev: -9.5954)

04:00 GMT - ID: Exports (Mar) 4cast: -12.00% y/y (Prev: -11.33)

04:00 GMT - ID: Imports (Mar) 4cast: -10.50% y/y (Prev: -13.98)

04:00 GMT - ID: Trade Balance (Mar) 4cast:772 USD mn [Prev: 330]

06:30 GMT - IN: WPI (Mar) 4cast: 3.3% y/y (Mkt: 3.2 Prev: 2.93)

12:30 GMT - US: Empire State Survey (Apr) [Mkt: 6.7, Prev: 3.7]

13:00 GMT - CA: Existing Home Sales (Mar) 4cast: 4% m/m (Mkt: Prev: -9.1)

20:00 GMT - US: Net Long-term TICS Flows (Feb) USD bn (Prev: -7.2)

EVENTS & AUCTIONS

- US: Fed's Rosengren speaks in Davidson, NC

- 10:45 GMT - UK: BoE's Breeden speaks in London

- 14:30 GMT - CA: BoC Business Outlook Survey

- 15:30 GMT - US: 3mth Bills Auction

- 15:30 GMT - US: 6mth Bills Auction

- 16:00 GMT - UK: BoE's Haskel speaks in London

- 17:00 GMT - US: Fed's Evans speaks

- 17:30 GMT - EU: ECB's Villeroy speaks in New York


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