Global Markets:
- Asian stock markets: Nikkei down 0.40 %, Shanghai Composite gained 0.80 %, Hang Seng rose 0.15 %, ASX fell 0.45 %
- Commodities: Gold at $1112.80 (-0.40 %), Silver at $15.38 (-0.25 %), WTI Oil at $41.98 (-0.60 %), Brent Oil at $49.55 (-0.20 %)
- Rates: US 10 year yield at 2.17, UK 10 year yield at 1.85, German 10 year yield
News & Data:
- New Zealand Real Retail Sales (QoQ) Q2: 0.1% (exp 0.5% prev 2.7%)
- PBOC Fixes Yuan Reference Rate At 6.3975 (prev 6.4010)
- RBA’s Kent: Jobless Rate Still Very High, A Lot Of Spare Capacity Seen
- RBA’s Kent: Slightly More Positive Data, But Growth Still Moderate, Uncertainty Remains, RBA To Be Open Minded
- RBA’s Kent: Further Passthrough Of Lower AUD Still To Come
- Asia shares set to end week lower; crude oil slumps – RTRS
- U.S. crude oil dips below $42 on high U.S. stocks, Asia economy worries – RTRS
- Solid U.S. retail sales bolster Fed rate hike expectations – RTRS
Markets Update:
The focus overnight was again on the Asian currencies. The Chinese Yuan appreciated slightly at today’s PBOC fix, which was set at 6.3975 (vs. 6.4010 yesterday). However, other APAC currencies were under pressure, with the Malaysian Ringgit falling to fresh multi-year lows and USD/SGD back above 1.40.
In the major pairs, price action was rather quiet. USD/JPY seems comfortable in the 124-125 range; strong selling interest reported above 125.00, while key support now lies at 123.50/75. AUD/USD traded in a 0.7355-85 and remains well bid overall. The Kiwi Dollar fell after disappointing retail sales data, which arrived at 0.1 % q/q vs 0.5 % expected. NZD/USD dropped to a low of 0.6512, while AUD/NZD rallied from 1.12 to a high of 1.1296.
USD/CAD is still quite choppy – USD weakness is preventing it from rallying, but with Oil posting fresh lows, the Canadian Dollar is also under pressure. 1.2950 and 1.3155 are the key levels to watch.
Upcoming Events:
- 07:00 BST – German GDP
- 09:00 BST – Italian GDP
- 10:00 BST – Euro Zone CPI
- 13:30 BST – US PPI
- 14:15 BST – US Industrial Production
- 14:15 BST – US Manufacturing Production
- 15:00 BST – US Michigan Consumer Sentiment
