Global Markets:

  • Asian stock markets: Nikkei up 0.15 %, Shanghai Comp and ASX both lost 0.70 %, Hang Seng down 2 %
  • Commodities: Gold at $1257 (+0.70 %), Silver at $19.09 (+0.90 %), Crude Oil at $92.81 (+0.05 %)
  • Rates: US 10 year yield stands at 2.505

News & Data:

  • Australia Westpac Consumer Sentiment -4.6 %, Previous: 3.8 %
  • BOJ Deputy Governor Iwata: Inflation expectations are rising on the whole
  • Iwata: Weak yen to assist exports but not as strongly as before and weak yen factor in price rises in short-term
  • IMF’s Dep MD Zhu Min: World economy suprisingly weak in the first half of the year; global growth to remain a challenge next year

FX Overview:

  • AUD – AUD/USD broke below the key 0.92 support level, where it last traded in March this year. The daily close sub-0.92 has attracted further selling in Asia and after the disappointing econ data releases, the pair extended losses to 0.9155. Next support is seen at 0.9140, while key intraday resistance now lies at 0.9220 and then 0.9248. Asia reports larger offers resting ahead of the 0.92 level and then again between 0.9220 and 0.9230. AUD/NZD has hit a low of 1.11 overnight and is likely to test 1.1050 support soon.
  • CAD – USD/CAD slightly under pressure after it failed to close the day above 1.10. However, with broad USD strength the main theme currently, the pair is likely to stay bid. Dealers report good bids from local names between 1.0940 and 1.0950. To the topside, offers at 1.1020 with intraday stops building through 1.1030.
  • EUR – Bit of a short squeeze in EUR/USD yesterday as it briefly broke above 1.2950. The currency is actually well-bid overall, as it has gained against most of the other G10 currencies and it’s weakness vs. the USD has been limited. This is not surprising given the extreme positioning, which makes it difficult to push the Euro lower without another strong catalyst. A squeeze up to 1.3000/20 could be possible in the near-term.

Upcoming Events:

  • 21:00 GMT – Reserve Bank of New Zealand Rate Decision & Statement
  • 21:00 GMT – RBNZ Governor Wheeler speaks