17 February 2017
Asia FX and News -
+ Australia and NZ to work together to engage TPP members on the way forward for the Agreement - NZ PM English.
+ Specific contents of the newly formed U.S.-Japan economic dialogue have yet to be decided - FinMin Aso - BBG.
+ FT: EZ FinMins to miss next week's deadline to agree with the IMF to release €7bn in aid to Greece.
+ PBoC to tightly balance injections and drains of liquidity on the interbank market to keep monetary policy on a "neutral and prudent" course, Financial News reports.
+ Tight ranges across FX in Asia on Friday, the AUD weighed by a failure to hold over .77 with some extra weight coming from the crosses. USD/JPY held up reasonably well in the face of equity markets in general heading lower.
+ N225 closed -0.58% at 19234.62. 10 year JGBs yield 0.085%.
European FX and News -
+ The USD proved generally better bid but with the notable exception of USD/JPY which headed below 113.00 as softer equities finally played some catch-up, while there is also some suspicion of GBP/JPY interest as GBP took a dive starting ahead of the release of UK retail sales data.
+ The UK data was another disappointment with a 0.3% fall against median expectation of +1.0% with some downward revisions also noted. Not for the first time GBP has started to come off in the 30 mins leading up to the release, the dip continuing to see a few trades sub 1.24 for Cable while EUR/GBP has been as high as .8590. GBP/JPY is around 2 Yen lower on the day.
+ EUR/USD eased to a low at 1.0635 before some short covering saw it recover to around 1.0650, no Eurozone data of any note to day.
+ AUD/USD has been down to just above .7650 as positions get trimmed following the failure to hold over .77, AUD again having to give back some ground to NZD and CAD although the crosses still comfortably clear of 1.06 and 1.00. USD/CAD came within 10 pips of 1.31 but in thin trade as Crude posts very modest losses, down around 20c.
+ EUR/SEK ticked a little higher in its range on soft Swedish inflation data but soon settled back. The NOK is again sticking close as NOK/SEK runs over 1.07 remain brief. EUR/CHF meanwhile is marginally heavier and stuck below 1.0650.
Bonds and Equities -
+ Consolidation seen in periphery spreads after y'day's tightening while Bunds bull-flatten as equities pull back. Safety bids also seen in Gilts with an added hand from the soft retail sales data.
+ Eurozone equity markets are under water with Dax -0.5%, Eurostoxx -0.85%, but the data and weaker GBP helping the FTSE hold close to unchanged.
+ Sweden: CPI inflation fell by -0.7%m/m in January which pulled down the y/y rate to 1.4%y/y from 1.7%y/y in December. This was slightly below the consensus of 1.5%y/y but in-line with our 1.4% forecast. In the meantime the underlying rate (CPIF) also fell by -0.7%m/m, which corresponds to 1.6%y/y (prev: 1.9%y/y), which was marginally below consensus of 1.7%y/y but again in-line with our 1.6% projection.
+ UK: Retail Sales (including fuel) fell by 0.3%m/m in January following December's -2.1%m/m (revised from -1.9%m/m), and this is weaker than the consensus of 1.0%m/m. The y/y rate has at the same time fallen to 1.5% from 4.3% in November (revised from 4.1%) and this compares to the consensus of 3.4%y/y.
Still To Be Released -
14:00 GMT - BE: BNB Consumer Confidence (Feb) (Prev: 0)
15:00 GMT - US: Leading Indicator (Jan) % m/m (Mkt: 0.5 Prev: 0.5)
Events & Auctions:
US: Sovereign Debt to be Rated by Moody's
17:30 GMT - SE: Riksbank's Jochnick Speaks in New York