Finally, we had an eventful Asian session, although that didn’t go well with Antipodeans, as the Australian Q2 Capex and New Zealand,business confidence data disappointed. The Kiwi was the biggest loser, down nearly 1% near 0.6650 levels while the Aussie dropped -0.50% to 0.7275 region. The Yen remained better bid against the US dollar amid moderate risk-aversion, as reflected upon the Asian equities.
Meanwhile, the sell-off in the Antipodeans offered some support to the US dollar against the EUR, the GBP and CAD while the pound stalled its Brexit optimism-led upside near 1.3040 levels.
Among the commodities, both crude benchmarks were buoyed by a bigger-than-expected drop in the US crude stockpiles, as reported by the EIA a day before while gold prices traded weaker near $ 1210 levels ahead of the Fed’s most preferred inflation data due to be released later today.
Main topics in Asia
Canada’s Freeland: NAFTA trade negotiations with the US were at a “very intense moment”
Following the trade talks with the US Trade Representative Lighthizer late-Wednesday, Canada’s Foreign Minister Freeland came out on the wires, via Reuters, noting the following.
Trump issues order on adjusting imports of aluminium in the US
Livesquawk is out with the latest comments from the US President Trump, as he comments on the US metals tariffs.
The US Commerce Department issued a statement last minutes, citing that the US President Trump signed a proclamation allowing targeted relief from steel quotas on South Korea, Argentina and Brazil, and Aluminum quotas from Argentina.
Australia’s Q2 Capex headline arrives at -2.5% vs +0.6% expected
Australian capex (private capital expenditure) for Q2 shows a capex ‘headline’ of -2.5% q/q vs +0.6% expected and +0.4% last. The 3rd estimate for 2018/19 investment expectations came at AUD 102 bn, which is a weak result.
NZ: Headline business confidence fell a further 5 points in August – ANZ
Sharon Zollner, Chief Economist at ANZ, notes that New Zealand’s headline business confidence fell a further 5 points in August, but firms’ views of their own activity were steady.
Sources: China, N. Korea increase economic exchanges in border areas – Yonhap
South Korea’s state news agency, Yonhap, quoted sources with the knowledge of the matter on Thursday, citing that China is seen improving its economic cooperation with North Korea, as the Chinese authorities recently increased the economic exchanges near the North Korean border.
Gold Technical Analysis: Stuck in a rising broadening wedge
Gold has charted a rising broadening wedge on the hourly chart. More importantly, the 100-hour moving average (MA) has met the wedge support of $1,203,50.
Key Focus ahead
Markets will finally see an eventful EU calendar today, with the German Prelim CPI release – the main event risk that will drop in at 1200 GMT. Ahead of the German inflation, the German jobs data is due at 0755 GMT, followed by the UK mortgage approvals and net lending to individuals data at 0830 GMT. Also, a slew of confidence numbers from the Eurozone will be reported at 0930 GMT, which will offer some trading incentives to the EUR, GBP traders.
The NA session also looks busy, with the US core PCE price index, jobless claims and personal spending data slated for release at 1230 GMT. At the same time, the Canadian Q2 GDP will be reported, with annualized q/q figures seen rising 3.0% versus 1.3% previous. Later in the American mid-morning, the ECB Vice-President Jens Weidmann’s speech will be closely heard for any hints on the ECB’s rate hike plans.
EUR/USD: Focus on inflation differential, monthly candle signals bear exhaustion
The currency pair could pick up a strong bid in the run-up to the US inflation release if the German preliminary consumer price index (CPI) reading, due for release at, 12:30 GMT, beats estimates.
GBP/USD inches closer to 1.3050 on Brexit optimism, US PCE eyed
The GBP/USD pair broke slightly higher from the overnight bullish consolidation and hit fresh four-week highs at 1.3039, now awaiting fresh impetus for the next push higher.
US PCE inflation preview: don’t expect too much action here
Fresh US monthly Income and Spending data, including PCE inflation, will be out this Thursday. Fed’s favorite inflation reading usually has a limited immediate effect on the USD but provides hints on future central bank’s moves.
Canada: Upside GDP surprise to produce a knee-jerk move lower in USDCAD – TDS
According to analysts at TD Securities, given the repricing of the BoC and the positive flow of NAFTA headlines, they think the loonie has priced in a lot of the good news.
How to trade Canada’s quarterly GDP with USD/CAD
Canada’s quarterly GDP report has a significant impact and moves the C$. The Market Impact Tool shows trading opportunities in both upside and downside surprises on this event.
China: Official manufacturing PMI to drop further to 51.1 in August – Nomura
Analysts at Nomura offer key insights on the official August manufacturing and services PMIs from China will be released on Friday at 0100 GMT.
Share
