Global Markets:
- Asian stock markets: Nikkei gained 0.20 %, Shanghai Composite fell 0.10 %, Hang Seng rose 1.50 %, ASX 200 up 0.35 %
- Commodities: Gold at $1368 (+0.10 %), Silver at $20.39 (-0.25 %), WTI Oil at $41.60 (-0.75 %), Brent Oil at $43.90 (-0.85 %)
- Rates: US 10 year yield at 1.50, UK 10 year yield at 0.64, German 10 year yield at -0.09
News & Data:
- Australia AiG PCI (Jul): 51.6 (prev 53.2)
- Japan Labour Cash Earnings (YoY) Jun: 1.3% (exp 0.3% prev rev -0.1%)
- Japan Real Cash Earnings (YoY) Jun: 1.8% (prev rev 0.4%)
- Japanese Economic Minister Ishihara: Closely Watching FX Moves
- Japanese Finance Minister Aso: To Work Closely with BoJ to Use All Policy Tools to Support Growth — RTRS
- RBA SoMP: Repeats Policy Easing to Help Foster Growth, Offers No Forward Guidance
- RBA SoMP: Underlying Inflation to Remain Under 2% For Much of Forecast Period, Reach 2 % By End 2018
- RBA SoMP: Prospects for Economy Positive, But Low Inflation Allows for "Even Stronger Growth"
- RBA SoMP: Judged Risks Associated with Rising House Prices and Debt Had Diminished
- RBA SoMP: A$ Remains Significant Source of Uncertainty for Inflation, Growth Forecasts
- RBA SoMP: Economic Growth and Inflation Forecasts Little Changed Overall
- RBA SoMP: Drag On GDP from Falling Mining Investment Looks to Have Peaked, Non-Mining Still Subdued
- RBA SoMP: GDP Growth Looks to Have Moderated in Q2 as Net Exports Added Less
Markets Update:
The main event overnight was the release of the RBA meeting minutes, although there were no surprises. The RBA warned that the high Australian Dollar remains a significant source of uncertainty for inflation and growth forecasts. Despite the RBA rate cut last week, the Australian Dollar has risen against most currencies and AUD/USD posted a fresh weekly high overnight as it rose to 0.7662. The market sent a clear signal that the RBA will have to do more if it wants to weaken its currency.
Flows in the other major currency pairs were rather light. USD/JPY failed at 101.40 resistance in the early Asian session and declined to 101.05. EUR/USD was caught in a 1.1125-36 range, while GBP/USD consolidated between 1.31 and 1.3135. NZD/USD followed the AUD higher and rose from 0.7170 to 0.72.
Markets may stay quiet in the upcoming EU session as traders are waiting for the release of the latest US employment data at 1330 BST.
Upcoming Events:
- 07:00 BST – German Factory Orders
- 07:45 BST – French Trade Balance
- 08:30 BST – UK Halifax House Price Index
- 13:30 BST – US NFP
- 13:30 BST – US Unemployment Rate
- 13:30 BST – US Average Hourly Earnings
- 13:30 BST – US Trade Balance
- 13:30 BST – Canadian Employment Change
- 13:30 BST – Canadian Unemployment Rate
- 13:30 BST – Canadian Trade Balance
- 15:00 BST – Canadian Ivey PMI
