Data after market close

Traders in Asia eagerly awaited the June trade data out of China, only to find the wait extended and extended. Latest rumours from the financial press suggest that they will released around 0700GMT later today. Pessimist might assume that the delay in releasing the data until after local markets have closed is a result of very poor numbers.

Recent surveys imply that export fell 2.0% y/y in June while imports crashed 4.5% y/y, resulting in a wider trade surplus of $44.7 billion from $41.7 billion in May.

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AUD/USD has risen for three straight days and is edging toward the 100-day moving average at 0.7023. That moving average has capped prices on a closing basis since April 22. Support will likely be found at the 61.8% Fibonacci retracement of the June-July rally at 0.6915.

AUD/USD Daily Chart

Singapore economy unexpectedly shrinks

The Singapore economy contracted 3.4% q/q in the second quarter, the largest contraction in about seven years, data released today showed. Economists had anticipated a milder slowdown to +0.1% from +3.8% in the last quarter of 2018. On an annualised basis, growth was a mere +0.1%, the slowest in a decade. The decline was mostly attributed to the manufacturing sector, which shrank 3.4% y/y as a result f the ongoing US-China trade frictions. Construction output was +2.2% y/y while services output grew 1.2%.

The Singapore dollar weakened mildly after the data, with USD/SGD rising to 1.3577 from 1.3571 at the open. The FX pair touched the lowest in eleven days yesterday amid broader US dollar weakness after Powell’s two days of testimony.

USD/SGD Daily Chart

Slow calendar to close the week

Final Japan industrial production data for may is seen holding steady with a 2.3% m/m increase, the same as in April. Capacity utilisation is expected to rise just 0.2% after a 1.6% gain the previous month. Germany’s wholesale price index is seen rising 0.2% m/m and 1.3% y/y while the Euro-zone May industrial production probably rebounded to +0.2% m/m following a 0.5% decline in April.

There’s not much data for the US session, with June producer prices and a speech from Fed’s Evans scheduled.

 

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