Thu, May 16, 2024 @ 10:47 GMT
Facebook Mail RSS Twitter
Live Comments Page 649

Live Comments

Latest

HKMA bought HKD 3.59b in fifth intervention move

    By
    ActionForex.com
    -

    The Hong Kong Monetary Authority (HKMA) intervenes in the markets again today to defend the peg to US Dollar. HKD 3.59b (USD 457m) was bought by HKMA (at around 3pm HKT) as the currency remains persistently weak and continues to press its trading band.

    This is the fifth action intervention in recent period and the first time that happens during HK stock trading house. Accumulatively, HKMA bought HKD 13.55b in total.

    Japan and China agreed to improve tie after first high-level meeting in eight years

      By
      ActionForex.com
      -

      The outcome of the first high-level economic talks in eight years between China and Japan appeared to be positive. Japanese Foreign Affairs Minister Taro Kono and Chinese State Councillor Wang Yi met in Tokyo on Sunday. Both agreed to work on strengthening the relationship with more high level visits ahead.

      Wang said that “I hope we can begin at a fresh starting point and discuss a new future, while promoting a new cooperative relationship. I want to have in-depth discussions on economic policies, cooperation on the belt and road initiative and further integration of East Asian countries.”

      Kono also said that “I hope to hold active discussions about regional and global economic issues. I would also like to take this opportunity to further strengthen economic relations between Japan and China.”

      Also more high-level visits were agreed, with Chinese Premier Li Keqiang go to Japan for a Japan-China-South Korea summit. And then Japan Prime Minister Shinzo Abe will visit China while Chinese President Xi Jinping will also visit Japan.

      Separately, Abe will meet with US President Donald Trump at the latter’s Mar-a Lago resort for two days this week starting Tuesday.

      UK PM May to boost trade with Commonwealth family

        By
        ActionForex.com
        -

        The leaders of the 53 Commonwealth member states are meeting in the Commonwealth Heads of Government Meeting this week. UK Prime Minister Theresa May is expected to make use of her speech at the business forum today to boost trade as Brexit looms.

        Ahead of the meeting, May said in a statement that “our Commonwealth family already accounts for one-fifth of global trade.” And “we must continue to work together to build further upon this solid foundation by building on our existing trade links and establishing new ones.” May is set to unveil new programs to boost Commonwealth-wide support to women-owned businesses. There will also be new funding for a new Commonwealth Standards Network to establish a common language for goods and services.

        Separately, a major push for a “people’s vote” on the final Brexit deal was launched by MPS of different parties, celebrities and business leaders. The MPs included Conservative Anna Soubry, Labour’s Chuka Umunna, the Greens’ Caroline Lucas and Liberal Democrat Layla Moran.

        Nieto, Trudeau and Pence pushing to reach NAFTA agreement within weeks

          By
          ActionForex.com
          -

          Mexican President Enrique Pena Nieto, US Vice President Mike Pence and Canadian Prime Minister Justin Trudeau met in Lima, Peru, on the sidelines of the Summit of the Americas.

          After the meeting, Nieto said there were agreement to “accelerate” the efforts on NAFTA renegotiation. And he added “we hope in the coming weeks we can reach an agreement”.

          Trudeau also said “we’d like to see a re-negotiated deal land sooner than later.” And, “we have a certain amount of pressure to try to move forward successfully in the coming weeks.”

          Pence also said he left the summit “very hopeful that we are very close to a renegotiated NAFTA”, and “there is a real possibility that we could arrive at an agreement within the next several weeks.”

          It’s believed that all parties would like to complete the deal by Mexican elections on July 1.

          Former Japan PM Koizumi: Abe’s situation is getting dangerous

            By
            ActionForex.com
            -

            According to a poll by Nippon TV, support for Japan Prime Minister Shinzo Abe dropped to 26.7%, hitting the lowest point after taking office back in December 2012. Another survey by Kydo news agency also showed Abe’s supported from -5.4 points to 37%. Another poll by Asahi also showed Abe’s support at only 31%.

            Recent suspected scandals have clearly hurt Abe’s popularity and raised doubts on whether can win a third term as PM as LDP leader in the September vote.

            Former Prime Minister Junichiro Koizumi questioned whether Abe may “resign around the time parliament’s session ends (on June 20)?”, as quoted in weekly magazine Aera. Koizumi also said that “situation is getting dangerous”.

            Insensitive reaction to Syria strike, but China and HK stocks lead market down

              By
              ActionForex.com
              -

              Initial reactions to the Syria strike by US, UK, and France were rather “insensitive”. The “one-time shot” was performed and finished quickly and there was no further escalation after that over the weekend. Markets are not pricing in additional geopolitical risks for the moment.

              But after a calm start, markets turn into risk averse mode again as the Asian session goes, led by selloff in Chinese and Hong Kong stocks. At the time of writing, China SSE is down -1.6%, HK HSI is down -1.5%.

              JPY and CHF jumps in the current 4H bar while CAD, AUD, NZD are pressured. CAD is additionally weighed down by WTI crude dipping below 67 to 66.8.

              US, UK, France struck Assad’s chemical weapons facilities in one-time shot

                By
                ActionForex.com
                -

                US, UK and France launched attack in Syria in retaliation for a chemical weapon attack outside Damascus by Bashar al-Assad’s regime. US Defence Secretary Jim Mattis said more than 100 missiles were fired, and struck three of Syria’s main chemical weapons facilities. Mattis also said that is a “one-time shot” to send a “very strong message” to Assad to “dissuade him, to deter him”. And no attack is planned for now. Russia’s Defence Ministry said the majority of missiles fired were intercepted by Syrian government air defence systems.

                Anatoly Antonov, Russia’s ambassador to the US responded by writing on Facebook that “Our worst apprehensions have come true. Our warnings have been left unheard.” And, “we warned that such actions will not be left without consequences.” He also condemned that “insulting the President of Russia is unacceptable and inadmissible” apparently referring to US President Donald Trump’s mention of Russian President Vladimir Putin is his speech.

                In Trump’s televised speech, he said “in 2013 President Putin and his government promised the world that they would guarantee the elimination of Syria’s chemical weapons. Assad’s recent attack and today’s response are the direct result of Russia’s failure to keep that promise. Russia must decide if it will continue down this dark path, or if it will join with civilized nations as a force for stability and peace.”

                St. Louis Fed Bullard downplays rise in core CPI

                  By
                  ActionForex.com
                  -

                  St. Louis Fed President James Bullard tried to down play recent rise in core inflation, where core CPI rose above 2% to 2.1% in March. Bullard said “year-over-year core CPI is now above 2 percent but it was also above 2 percent all during 2016, and so it’s really only come back to the level that it was in that earlier period when interest rates were much lower.” And to him, “those developments so far have been unsurprising.”

                  Regarding trade tensions, Bullard said there is too much uncertainty around the tariffs to assess the impact for now. But he hoped that US and China will get a good outcome on trade.

                  Regarding exchange rates, Bullard said growth growth has been surprising, in particular in Europe. Such strength wasn’t priced in and thus, led to dollar weakness.

                  Boston Fed Rosengren: Somewhat more tightening may end up being needed

                    By
                    ActionForex.com
                    -

                    Boston Fed President Eric Rosengren sounded hawkish in his comments today. Referring to Fed’s projection of two more hikes this year, Rosengren said that “somewhat more tightening may end up being needed”. He expected a “somewhat stronger” economy ahead than the already “quite positive” FOMC projections. He also pointed to solid performance in job creation, falling unemployment and inflation close to Fed’s 2% target.

                    However, Rosengren also pointed out short-run and long-run risks to the positive outlook.

                    For the short run risks, he pointed to trade tension. He noted that “it would take a significantly broader set of trade actions than those reported to date to materially reduce the roughly $2.4 trillion in annual U.S. exports.” But still “spillover effects are possible.”

                    Another run risk is an overheated “boom-bust” scenario. Particularly, “periods in which unemployment dipped significantly and persistently below the estimated natural rate historically have tended to generate conditions that resulted in a recession.”

                    In the long run, he expressed his concern regarding the narrowing of fiscal and monetary buffers. He said “by using up so much fiscal capacity now – by which I mean the ability to lower tax rates or boost federal spending to offset economic weakness – the country risks not having sufficient fiscal capacity in the future when it might be needed.”

                    There would be also be little room for monetary policy to respond to a large adverse shocks considering the median forecast among FOMC members for longer-run interest rates is 2.9 percent – “quite low” by historical standards

                    TPP member Japan, Australia, Malaysia told Trump, you’re welcomed but no renegotiation

                      By
                      ActionForex.com
                      -

                      Trump got slaps straight into his face by some members of the 11 nation Trans-Pacific Partnership today. While member countries welcomed Trump’s intention to consider rejoining, they made themselves clear that there will be no renegotiation. That is, take it or leave us alone.

                      Australia Trade Minister Steven Ciobo said today that “we welcome the U.S. coming back to the table but I don’t see any wholesale appetite for any material re-negotiation of the TPP-11.”

                      Japan Minister Toshimitsu Motegi said the current deal is a “balanced one, like fine glassware” and it would be difficult to change.

                      Malaysia International Trade and Industry Minister Mustapa Mohamed also warned that renegotiation would “alter the balance of benefits for parties.”

                      T11 include Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam.

                      US withdrawn from TPP on 23 January 2017 after Trump signed a Presidential memorandum, less than a month he took office.

                      Earlier today, Trump tweeted, “Would only join TPP if the deal were substantially better than the deal offered to Pres. Obama. We already have BILATERAL deals with six of the eleven nations in TPP, and are working to make a deal with the biggest of those nations, Japan, who has hit us hard on trade for years!” That came after news that Trump ordered White House economic adviser Larry Kudlow and Trade Representative Robert Lighthizer to examine the benefits of re-entering TPP.

                      S&P upgrades Japan’s A+ rating outlook to “positive”

                        By
                        ActionForex.com
                        -

                        S&P Global Ratings upgraded Japan’s A+ outlook from “stable” to “positive”. S&P noted stronger economy should set the stage for fiscal improvement in Japan. The positive outlook reflects healthier growth prospect, in both real and nominal terms. The current rating also reflect Japan’s formidable external position, diversified economy, political stability and financial system stability. Nonetheless, it also pointed out that While Japan’s external balance sheet is strong, Government finances are weak. And that is a significant constraint of its creditworthiness.

                        Some analysts view that outlook upgrade as an endorsement of Abenomics too.

                        But for now, JPY is not listening to the news and stays broadly pressured.

                        JPY selloff intensifies, AUDJPY catching up NZDJPY

                          By
                          ActionForex.com
                          -

                          JPY drops sharply today as most of the imminent risks abated, temporarily, including missile strike in Syria, US-China trade war etc. Selling momentum persist as seen in both 4H and D heatmap. And the selloff is spilling over to USD too.

                          GBP and commodity currencies are strong with AUD/JPY and GBP/JPY topping the top movers chart for today.

                          For the week, CAD/JPY is the strongest one, followed by NZD/JPY and AUD/JPY but they are close.

                          Taking a look at AUD/JPY, it’s now targeting 84.51 near term resistance. Firm break there should be a strong sign of trend reversal. That is, the whole decline fro 90.29 has completed at 80.48. And in that case, AUD/JPY should target 89.08/90.29 resistance zone in short to medium term term.

                          Meanwhile, NZD/JPY has actually taken out equivalent resistance at 78.61 earlier this week. It’s also on track for 81.55/83.90 resistance zone. Comparing the two, AUD/JPY is trying to catch up. And as we mentioned in a post before, we’d still prefer NZD/JPY to AUD/JPY for long trade.

                          Trump reconsiders joining TPP, Japan FM Aso said he’s temperamental

                            By
                            ActionForex.com
                            -

                            Attention has turned to report that US President Donald Trump ordered White House economic adviser Larry Kudlow and Trade Representative Robert Lighthizer to examine the benefits of re-entering the Trans-Pacific Partnership trade pact. That sounded to be another 180 degree turn in Trump’s position as withdrawing TPP was among the first things he did after taking office.

                            However, Trump himself tweeted today that “Would only join TPP if the deal were substantially better than the deal offered to Pres. Obama. We already have BILATERAL deals with six of the eleven nations in TPP, and are working to make a deal with the biggest of those nations, Japan, who has hit us hard on trade for years!”

                            Japan Finance minister Taro Aso also said that Trump “is a person who could change temperamentally, so he may say something different the next day”. Aso also emphasized that “after the U.S. withdrawal, Japan, recognizing the significance of free trade, has led the initiative in pulling together the TPP 11.” Aso would welcome US rejoining “if it’s true” and hailed that “our efforts have borne fruit if the United States judged it would be better to rejoin.”

                            China trade balance Q1: EU imports surged 17.5% to $63.5b, US imports rose only 8.9% to $41.7b

                              By
                              ActionForex.com
                              -

                              China reported a rate trade deficit of USD -5b in March versus expectation of USD 27.8b surplus. That’s also the first monthly trade deficit since last February. Imports rose 5.9% yoy while exports dropped -2.7% yoy. Trade surplus with US dropped to USD 15.3b. In CNY terms trade balance came in at CNY -30b deficit versus expectation of CNY 160b surplus. Imports dropped -9.8% yoy while exports also dropped -9.8% yoy.

                              For the quarter from January to March, 2018, China’s trade surplus came in at USD 49.1b, dropped -23.2% yoy from Q1 of 2017. Exports rose 14.1% yoy. But import grew even stronger by 18.9% yoy. In CNY terms, Q1 trade surplus rose came in at CNY 326.2b with exports increased by 7.4% yoy and imports jumped even stronger by 11.7% yoy.

                              Also for Q1, export to US rose 14.8% yoy to USD 99.9b while imports from US rose 8.9% yoy to USD 41.7b. Exports to EU rose 13.2% yoy to USD 90.2b while imports from EU rose 17.5% yoy to USD 63.5b.

                              The EU is doing pretty well in selling the China.

                              New Zealand BusinessNZ PMI: Weak spot in production

                                By
                                ActionForex.com
                                -

                                New Zealand BusinessNZ Performance of Manufacturing Index (PMI) dropped -1.1 to 52.2 in March. That’s also the second consecutive decline in 2018 even though it still signaled expansion.

                                BusinessNZ’s executive director for manufacturing Catherine Beard:

                                • “On a positive note, the proportion of positive comments in March (55.1%) picked up from both February (51.4%) and January (50.7%).  Those who provided negative comments typically noted a lack of finding the right staff, reduced orders (both domestically and offshore) and general uncertainty in the market.”

                                BNZ Senior Economist, Craig Ebert:

                                • “The weak spot in March’s PMI was its production index.  With a seasonally adjusted outcome of 50.8 this was close to stalling. Compare this to February’s 53.7 and the exceptionally high reading of 61.0 back in November and a sense of sharp deceleration arises”.

                                A look at Euro pairs after today’s selloff

                                  By
                                  ActionForex.com
                                  -

                                  Euro suffered broad based selling today, except versus JPY and CHF. Markets seemed to take ECB minutes rather negatively. The cautious tone prompted talks that ECB could stay dovish for longer than expected. Let’s have a quick glance on how Euro pairs are doing.

                                  EUR/USD breached 1.2302 minor support briefly, but stabilized since then. There is, so far, at least no downside acceleration through 1.2302 yet. And, even if that happens, the key support level is at 1.2214. As long as it holds, the triangle pattern from 1.2555 is still intact and larger up trend remains in favor to resume later..

                                  EUR/JPY is staying in consolidation below 132.61 temporary top. But it’s holding well above 131.09 minor support. Thus, the rebound from 128.94 is still expected to extend higher at a later stage to 61.8% retracement of 137.49 to 128.94 at 134.22 and above.

                                  EUR/CHF’s rally continues today and reached as high as 1.1888 so far. Long term up trend has just resumed this week and is on track for 1.2 handle.

                                  EUR/AUD extended the choppy fall from 1.6189 t as low as 1.5868. But for now, it’s staying above 1.5857 minors support. Hence, price actions from 1.6189 are viewed as a corrective move. Larger up trend is expected to resume at a later stage. Nonetheless, firm break of 1.5857 will be a sign of trend reversal and turn focus back to 1.5621 key support.

                                  EUR/CAD’s decline from 1.6151 extends today and reaches as low as 1.5490. The cross is on track for 38.2% retracement of 1.3782 (2016 low) to 1.6151 at 1.5246.

                                  EUR/GBP’s downside breakout today now confirms resumption of medium term decline from 0.9305. Next target will be 61.8% projection of 0.9305 to 0.8745 from 0.8967 at 0.8621. But based on current momentum, it will likely extend further to 100% projection at 0.8407.

                                  After all, we’d like to point out that outlook in Euro is indeed not that bearish in spite of today’s selloff. There is no doubt that EUR/CAD and EUR/GBP are in near term down trend. But there is not clear bearishness in EUR/USD and EUR/AUD yet. EUR/JPY is still likely to extend recent rebound. And EUR/CHF is making new high. So, Euro is overall, mixed only.

                                  Hong Kong Central Bank Intervenes as HKD Hit Weak Side of Trading Band

                                    By
                                    ActionForex.com
                                    -

                                    The Hong Kong Monetary Authority (HKMA) has just intervened in the currency market as the HK dollar (HKD) hit the weak side (7.85) of the trading band against US dollar (USD), the first time since 2005. The de facto central bank of the city has bought HK$816M Hong Kong dollars from the currency market. The intervention would lower the aggregate balance to HK$178.96 billion on April 16, when the withdrawn funds will be settled. Interbank liquidity would stay ample after the withdrawal. We do not think this would help much, if any, in narrowing the spread between HIBOR and LIBOR, the key reason causing capital to flow out of Hong Kong and hence weakness of HKD. As such, we do not feel surprised to see HKD to hit the weak side of the trading band again and this might lead to further HKMA intervention.

                                    Euro dives as ECB minutes contains no hawkishness, EUR/GBP to test 0.8666

                                      By
                                      ActionForex.com
                                      -

                                      Euro drops sharply as markets are disappointed that ECB account of March monetary policy meeting delivers no hawkishness at all. EUR weakens against all but JPY and CHF as seen in the current 4H heatmap.

                                      In particular, the sharp decline in EUR/GBP is now setting it up for a test on 0.8666 key support.

                                      Regarding inflation, ECB noted that “measures of underlying inflation remained subdued and had yet to show convincing signs of a sustained upward trend.” And, “ample degree of monetary policy accommodation remained necessary to accompany the economic expansion and for price pressures to continue to build up”. Also, “remaining uncertainties and muted underlying inflation pressures called for caution and underlined the need to maintain the prevailing policy posture of prudence, patience and persistence.”

                                      The removal of easing bias on regarding the asset purchase program from the forward guidance was justified because “economic expansion had become more robust and scenarios of large negative economic surprises, leading to renewed deflationary risks, had become less likely.” Still, the Governing Council members emphasized the “prudence, patience and persistence remained warranted and the key elements of the Governing Council’s forward guidance on policy rates and the APP needed to be confirmed, including the open-endedness of the APP.

                                      Regarding Euro’s exchange rate, ECB noted that “recent movements in the euro exchange rate seemed to relate more to the relative monetary policy shocks, including communication, and less to improvements in the macroeconomic outlook.” And, “this suggested that the exchange rate appreciation could be expected to have a more negative impact on inflation.”

                                      ECB also warned that “there was widespread concern that the risk of trade conflicts, which could be expected to have an adverse impact on activity for all countries involved, had increased.” ECB added,”it was also cautioned that negative confidence effects could arise.”

                                      Here is the full account.

                                      Dollar rebounds as Trump tweaks the meaing of his own tweet

                                        By
                                        ActionForex.com
                                        -

                                        Dollar rebounds after Trump backed down from his initial tough/high pressure position again. This time is about Syria. In his usual morning tweet, Trump said: “Never said when an attack on Syria would take place. Could be very soon or not so soon at all! In any event, the United States, under my Administration, has done a great job of ridding the region of ISIS. Where is our ‘Thank you America?'”

                                        At around the same time just yesterday, Trump tweeted “Russia vows to shoot down any and all missiles fired at Syria. Get ready Russia, because they will be coming, nice and new and ‘smart!’ You shouldn’t be partners with a Gas Killing Animal who kills his people and enjoys it!”

                                        These tweets reminded me of an old friend. We’re supposed to meet at a certain time but he’s not around past 30 mins or so. I called and asked, “hey are you coming?” And he said “yeah, I’m coming!”. After waiting for an hour, I called again and asked “hey you said you’re coming, didn’t you?” Then he answered, “yeah I’m coming. But I could come soon or not so soon at all!” Well, we’re never friends again since then.

                                        Anyway, from the 4H heatmap, USD’s strength is centered against EUR, JPY and, CHF and NZD. EUR/USD looks safe for the momentum as it’s holding well above 1.2303 minor support. USD/JPY is at around the mid-point of range of 106.61/107.48. The more imminent move could be find in USD/CHF considering that EUR/CHF also resumed the medium term up trend yesterday.

                                        European Council extends Iran sanctions by a year

                                          By
                                          ActionForex.com
                                          -

                                          European Council extends the sanctions on Iran over human rights violation by 1 year today, until April 2019.

                                          The sanctions include:

                                          • Asset freezes, travel restrictions against 82 people and 1 entity.
                                          • Ban on exports of equipment that could be used for internal repression and equipment used for monitoring telecommunications,
                                          Load more

                                          ActionForex.com was set up back in 2004 with the aim to provide insightful analysis to forex traders, serving the trading community for over a decade. Empowering the individual traders was, is, and will always be our motto going forward.

                                          Contact us: contact@actionforex.com

                                          © ActionForex.com © 2024 All rights reserved.