RBA Continues To Deliberate YCC

General trend

• Shanghai and HK equities have declined following holiday [Mining, Property and Financial firms lead declines]; Hang Seng TECH index drops over 1%; Consumer Staples and Liquor firms also extend losses in Shanghai.
• S&P ASX 200 has hit a record high after Monday’s holiday [Consumer Staples index outperforms; Austal weighs on Industrials].
• Nikkei has remained higher [Topix Electric Appliances index rises as USD/JPY is above ¥110; Brokerage and Air Transportation firms track declines in the US].
• Copper FUTs decline amid speculation related to reserves in China.
• US May PPI and Retail Sales due later today.
• US Fed decision [Jun 16th] is also among the key events for this week.
• RBA Gov Lowe is due to speak on Jun 17th (Thurs) [title of speech is ‘From Recovery to Expansion’].
• Companies due to report during the NY morning include Qudian.

Headlines/Economic data

Australia/New Zealand

• ASX 200 opened 0.0%.
• (AU) RESERVE BANK OF AUSTRALIA (RBA) JUNE MEETING MINUTES: AGREED IT WOULD BE PREMATURE TO CONSIDER CEASING BOND BUYING PROGRAMME; POLICY WOULD NEED TO REMAIN HIGHLY ACCOMMODATIVE TO REACH FULL EMPLOYMENT.
• (AU) AUSTRALIA Q1 HOUSE PRICE INDEX Q/Q: 5.4% V 7.8%E; Y/Y: 7.5% V 3.6% PRIOR.
• SGM.AU Raises FY21 (A$) underlying EBIT 360-380M (260-310M); general improvement in gross margin per tonne due to higher scrap prices, and good margin management.
• (NZ) New Zealand Treasury: RBNZ Gov should sit on the new governance board – issues comments on proposed bill currently in Parliament.
• (AU) Reserve Bank of Australia (RBA): Excess cash at exchange settlement (ES) accounts at A$256.8B v A$252.8B prior (Record high).

Japan

• Nikkei 225 opened +0.3%
• (JP) Bank of Japan (BOJ): No need to act on Market function for now; To remain determined to keep yields in target range – Press.
• (JP) Japan opposition parties planning to submit a no confidence motion against Japan PM Suga Cabinet, over handling of COVID and summer Olympics.
• (JP) Follow Up: Japan Chief Cabinet Sec Kato: Ruling party members will vote against the no confidence submission against the Cabinet.
• (JP) Okinawa, Japan sees need to extend COVID virus emergency – Japan press.
• (JP) Bank of Japan (BOJ) Former Member Sakurai: BOJ likely to extend a September deadline for its pandemic-relief program at this week’s policy meeting; too early to take steps to revitalize JGB market.

Korea

• Kospi opened 0.0%.
• (KR) South Korea President’s office said to hope to hold talks with Japan PM Suga on Korea President Moon visit to Japan – Press.

China/Hong Kong

• Hang Seng opened +0.4%; Shanghai Composite opened -0.1%.
• (CN) CHINA PBOC CONDUCTS CNY200B IN 1-YEAR MEDIUM-TERM LENDING FACILITY (MLF) AT 2.95% V 2.95% PRIOR, 14th straight operation that rate remained steady.
• (CN) China May YTD Foreign Direct Investment (FDI) CNY481B, +35.4% y/y, +30.3% from 2019.
• (CN) China PBOC Open Market Operation (OMO): Injects CNY10B in 7-day reverse repos v CNY10B in 7-day reverse repos prior; Net drain CNY10B v Net CNY0B prior.
• (CN) China Sec Journal: PBOC may increase its liquidity injections during the second half of June.
• (CN) China Govt: Nato urged to stop exaggerating Nato’s military power; China does not pose systemic challenges to other countries.
• (CN) China PBOC sets Yuan reference rate: 6.4070 v 6.3856 prior.

Other

• 2002.TW Chairman Chao-Tung: Will start charging a carbon surcharge, to take effect from 2022; would be among the first steel firms in Asia to implement such a surcharge – Press.

North America

• (CA) Said that the US and Canada will have discussions on lifting border restrictions on June 15th – Press.
• CHOBANI.IPO Chobani said to be planning an IPO for H2 of this year – press.
• (EU) Said that the EU will lift travel restrictions on US Residents during this week – Press.

Europe

• (UK) UK Australia free trade agreement (FTA) expected to be announced Tuesday (as expected) – Sky News.

Levels as of 01:00ET

• Hang Seng -0.8%; Shanghai Composite -1.0%; Kospi +0.2%; Nikkei225 +1.0%; ASX 200 +1.0%.
• Equity Futures: S&P500 +0.2%; Nasdaq100 +0.1%, Dax +0.2%; FTSE100 -0.7%.
• EUR 1.2127-1.2115; JPY 110.16-110.02; AUD 0.7717-0.7696; NZD 0.7158-0.7131.
• Commodity Futures: Gold +0.0% at $1,867/oz; Crude Oil +0.4% at $71.14/brl; Copper -2.2% at $4.42/lb.