Author: admin
MUFG’s Asia FX Weekly highlights that China’s July activity indicators, following weak Q2 GDP, will be central for the Chinese Yuan and regional FX. The authors stress ongoing weakness in fixed asset investment and property-sector challenges, and question whether domestic demand is stabilizing and whether PBOC will tolerate continued CNY strength. They also note PBOC has been guiding USD/CNY lower via its daily fixing.China data and fixing steer CNY”In China, attention will centre on July activity indicators, following a weak Q2 GDP print.””Fixed asset investment is likely to remain weak, underscoring ongoing challenges in the property sector.””The key question for…
USD/JPY is holding near 159.40 at the time of writing, with little change on the day. A weak United States (US) Consumer Sentiment reading nudged the Dollar lower, but the pair has stayed close to where it started.The University of Michigan’s preliminary Consumer Sentiment Index dropped to 51 in August from 55.2, well below the 54.5 that markets expected. The Expectations component fell to 50.6. It is the latest soft US number in a week that also brought cooler inflation and a weak Retail Sales report.Taken together, that run of data has taken some steam out of the US Dollar…
NZD/USD gains 0.75% on Friday and trades around 0.5895 at the time of writing, with its rally losing some momentum as it approaches the psychological 0.5900 level. The pair benefits mainly from weakness in the US Dollar (USD) following disappointing US economic data, while expectations surrounding the Reserve Bank of New Zealand (RBNZ) monetary policy continue to support the New Zealand Dollar (NZD).US Retail Sales contracted by 0.6% MoM in July, reversing a 0.2% increase in June and missing market expectations for a 0.1% rise. On an annual basis, sales increased by 5%. Weak consumer spending reinforces concerns about the…
TD Securities’ Oscar Munoz argues that Chair Kevin Warsh’s communication strategy has undermined market confidence in the Federal Reserve’s inflation-fighting resolve. The report expects Warsh to reset his approach as early as the Jackson Hole Symposium, with greater clarity on the Fed’s reaction function and policy framework seen as necessary to restore credibility and centralize guidance.Warsh seeks to rebuild Fed credibility”Questions around Fed credibility arose after the most recent FOMC meeting, with Chair Warsh’s lack of clarity about how the Committee intended to lower inflation acting as a key catalyst. We expect a reset on strategy by the chairman as…
The Indian rupee closed the week with losses against the dollar, with frequent dollar-selling interventions by the central bank curbing declines from the prolonged uncertainty from the months-long West Asia conflict.The rupee ended little changed at 95.4250 per on Friday but fell 0.2 per cent from a week ago.Persistent dollar sales by State-run banks, most likely on behalf of the Reserve Bank of India, anchored the currency in a less-than-30-paisa range during the week, and blunted the impact of sustained dollar demand from importers, volatile crude prices and the maturity of derivative contracts.Oil prices rose after the United States threatened…
Societe Generale notes India’s headline CPI rose slightly to 4.45% year-on-year in July, backing the RBI’s decision to keep policy unchanged. The central bank has reportedly been active in FX markets as the trade deficit widened. Higher Oil and Gold prices countered dovish Federal Reserve repricing, while non-resident inflows into Indian Government Bonds have helped support the Rupee.RBI activity and bond inflows aid rupee”India headline CPI edged up modestly to 4.45% yoy in July from 4.38% in June, reinforcing the latest decision by the RBI to keep policy on hold.””At the same time, the central bank has reportedly remained active…
The rupee gained 2 paise to 95.43 against the US dollar in early trade on Friday, backed by a weaker greenback overseas.The Indian currency, however, remained under pressure due to the withdrawal of foreign funds from domestic equities and rising crude oil prices amid geopolitical uncertainties, forex traders said.At the interbank foreign exchange market, the rupee opened at 95.39 and later slipped to trade at 95.43 against the American currency in early deals, up marginally by 2 paise from its previous closing level.On Thursday, the rupee closed 12 paise lower at 95.45 against the US dollar.Meanwhile, the dollar index, which…
Over the week so far, the rupee has hovered in a 95.17-95.4450 range. | Photo Credit: FRANCIS MASCARENHAS The Reserve Bank of India likely intervened in the foreign exchange market on Friday, three traders told Reuters, as uncertainty over the West Asia conflict kept risk appetite muted and oil prices elevated.The rupee was steady on the back of the intervention at 95.40 per dollar. It managed to hold above the psychologically important 95.50 level, similar to price action seen over much of this week where interventions have kept a firm lid on the currency’s losses.Over the week so far, the…
EUR/JPY remains flat after registering minor gains in the previous day, trading around 183.90 during the Asian hours on Friday. The currency cross is holding above the short-term nine-period Exponential Moving Average (EMA) but remaining capped by the medium-term 50-period EMA.The moving averages configuration, together with a near-neutral 14-day Relative Strength Index (RSI) at 48.21, suggests a consolidative tone with a slight bearish bias as the pair struggles to reclaim its 50-period EMA while still respecting nearby dynamic support.The EUR/JPY cross may test the immediate support at its nine-day Exponential Moving Average of 183.59. A decisive break below this short-term…
The yen headed for its biggest weekly loss in three months on Friday as the impact of U.S. and Japanese intervention faded, leaving traders to wager another round of official buying would be needed to stem the rot.The currency has surrendered roughly half the gains sparked by intervention in late July and early August, falling about 1% this week to 159.43 per dollar. It was trading near 164 per dollar before July’s intervention and traders see the 160 level as a potential trigger for fresh official action.The yen’s retreat is set to be its biggest weekly drop since May, when…