Global Markets:
- Asian stock markets: Nikkei up 1.00 %, Shanghai Composite gained 0.40 %, Hang Seng rose 0.55 %, ASX 200 rallied 0.35 %
- Commodities: Gold at $1337 (+0.20 %), Silver at $20.40 (+1.10 %), WTI Oil at $46.40 (-0.90 %), Brent Oil at $47.98 (-1.00 %)
- Rates: US 10 year yield at 1.49, UK 10 year yield at 0.82, German 10 year yield at -0.09
News & Data:
- Australian Westpac Consumer Confidence (MoM) Jul: -3.0% to 99.1 (prev -1.0% to 102.2)
- New Zealand Food Prices (MoM) Jun: 0.4% (prev -0.5%)
- South Korean Unemployment Rate Jun: 3.6% (est 3.7%, prev 3.7%)
- PBOC Fixes Yuan Reference Rate at 6.6891 (prev 6.6950)
- Fed’s Kashkari: Fed falling short on both parts of mandate – RTRS
- Kashkari: Fed should take time when raising rates – RTRS
- Kashkari: Fed considers stock prices when making decisions but not a key driver – RTRS
- Kashkari: Negative interest rates are unlikely in the US but not impossible
- Fed's Mester: Reiterate that gradual rate hikes are appropriate; June jobs data alleviated concerns over labour market progress – RTRS
- Mester: Hike is on the table at every meeting
- Mester: Don’t think the Fed will need more accommodative policy
- Japan PM Adviser Hamada: Helicopter money would be “risky gamble” – BBG
- China Premier Li: Can achieve 6.5% growth target this year – BBG
Markets Update:
USD/JPY retraced slightly after a 4 % rally since Monday morning. The pair has rallied after the announcement of an economic stimulus package, although no details have been made public yet. While the announcement alone was enough to send the Yen 4 % lower, the rally could run out of momentum quickly if there won’t be more details about the plan soon. USD/JPY fell from 104.90 at the Sydney open to a low of 103.95.
GBP/USD extended its gain and traded as high as 1.3335 in Asia, although it wasn't able to sustain momentum above 1.33 for long. Support is now seen at 1.3220 and 1.3180. EUR/USD traded in a 1.1055-70 range overnight and flows were light.
The commodity currencies came under slight pressure with AUD/USD falling from 0.7630 to a low of 0.7585 and NZD/USD declining from 0.73 to 0.7250.
Upcoming Events:
- 07:45 BST – French CPI
- 08:00 BST – Spanish CPI
- 09:00 BST – Italian CPI
- 10:00 BST – Euro Zone Industrial Production
- 11:00 BST – FOMC Member Harker speaks
- 14:00 BST – FOMC Member Kaplan speaks
- 15:00 BST – Bank of Canada Rate Decision
- 15:00 BST – Bank of Canada Monetary Policy Report
- 15:30 BST – US Crude Oil Inventories
- 16:15 BST – Bank of Canada Governor Poloz speaks
