FX News Today
Asian market wrap: Long yields moved broadly higher in Asia as stock markets gained. The 10-year JGB yield is up 0.9 bp at 0.111%, while 10-year Treasury yield fells back from highs and is down -0.4 bp at 2.969%. Stock markets started strong after the USA500 closed at the highest level since the Jan 26 peak, which helped investors to look past lingering trade jitters early in the session. Topix and Nikkei have wiped out most of their early gains, however, and as of 05:38 GMT were both up a mere 0.05% as the Yen strengthened against the Dollar. Chinese export growth unexpectedly accelerated and the trade surplus with the US was near record highs, but despite this Chinese markets underperformed and the CSI 300 is down -0.73%. The Hang Seng still managed a 0.50% gain and the ASX rose 0.22%. US futures are trading mixed and Oil prices are slightly higher with the September WTI future trading at USD 69.26 per barrel.
China’s trade surplus narrowed to $28.1 bln in July from $41.5 bln in June. A modest narrowing was expected. Exports grew 12.2% y/y in July after a revised 11.2% gain (was +11.3%). Imports surged 27.3% y/y in July following the 14.1% gain in June. Exports to the US accounted for 19.3% of total exports in July, down slightly from the 19.7% in June, the largest share of any single country. Meanwhile, the share of imports from the US was 7.2% versus 7.8%, down from 9.2% as recently as December. Japan (9.0%), South Korea (9.7%) and Taiwan (8.5%) are the top three nations in terms of percentage of total imports.
Charts of the Day
Main Macro Events Today
- Canadian Building Permits – Expectations – Permits are seen rising 1.0% after a 4.7% bounce in May, new home prices are seen rising 0.1% after the flat reading in May and starts are projected to moderate to a 220.0k pace from the lofty 248.1k growth rate in June.
- US Crude Oil Inventories – Expectations – at -3.33M barrels this week from 3.8M last week.
- RBNZ Rate Decision and Press Conference – At the June meeting, RBNZ held rates at 1.75% and opened the door to a rate cut if necessary. It is widely expected that policy will remain into next year.
Support and Resistance levels
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Andria Pichidi
Market Analyst
HotForex
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