Market Roundup
- Fed keeps U.S. rates steady, to start portfolio drawdown in October.
- BOJ keeps policy steady, newcomer to board dissents.
- Japan's Abe promises 'daring policies' to boost economy.
- BOJ asset buy program to remain, vote unanimous, Y80 trln/year pace.
- Japan Short-term rate target at-0.1%, dissent on YCC, Kataoka, felt more needed.
- "It's not over yet," Merkel warns supporters before vote.
- German economy to grow robustly in third quarter, finance minister says.
- NZ Q2 GDP q/q, 0.8% vs forecast 0.8%, revised 0.6% last 0.5%.
- NZ Q2 GDP y/y, 2.5% vs forecast 2.5%, last 2.5%.
- We want it in writing: Scotland and Wales seek clarity on post-Brexit powers.
- U.S. allies say sanctions the key to ending North Korea standoff.
- U.S. weighs whether to stay in Iran nuclear deal.
Economic Data Ahead
- (0400 ET/0800 GMT) Norway Central bank Rate Decision, 0.50% eyed; last 0.50%.
- (1000 ET/1400 GMT) EU September Consumer Confidence Flash, -1.50 eyed; last -0.50.
Key Events Ahead
- N/A ECB general council meeting in Frankfurt.
- (0330 ET/0730 GMT) Swedish C.Bank minutes from monetary policy will be published.
- (0430 ET/0830 GMT) Norway Central Bank's press conference in Oslo.
- (0530 ET/0930 GMT) ECB's Peter Praet speaks in Frankfurt.
- (0530 ET/0930 GMT) IE E0.5bln for 12-month auction.
- (0545 ET/0945 GMT) ES $4.0-4.5/$4.0-4.5/$4.0-4.5 bln for 4/9/27 year auction.
- (0600 ET/1000 GMT) France E6-7/E6-7/E6-7 bln for 3/6/7 year auction.
- (0600 ET/1000 GMT) France E1.5-2.0/E1.5-2.0/E1.5-2.0 bln for 4/11/13 years auction .
- (0915 ET/1315 GMT) ECB's Draghi speaks in Frankfurt.
FX Recap
USD: The dollar index against a basket of six major currencies was steady at 92.524 and near a two-week high of 92.697 set overnight, when it added 0.8 percent.
EUR/USD: The euro shed 0.1 percent to $1.1886 after dropping 0.8 percent the previous day, when it reversed a four-session winning run. The euro was up 0.15 percent at 133.645 yen, recovering some of the losses suffered the previous day, when the common currency's slide against the dollar nudged it away from a 21-month high of 134.160 set on Tuesday. Pair made intraday high at $1.1897 and low at $1.1865 levels. A sustained close above $1.1890 is requires for the upside rally. Alternatively, current downside movement will drag the parity down towards $1.1720 marks. Immediate support was seen 1.1720 and resistance was seen at 1.2034 marks.
USD/JPY: The yen hits fresh 2-month low against U.S. dollar after BOJ’s interest rate decision. BOJ kept monetary policy steady as expected. Pair made intraday high at 112.64 and low at 112.19 levels. A sustained close above 112.21 is required to take the parity higher towards 113.57, 115.37 and 117.42 marks. Alternatively, a daily close below 112.21 will drag the parity down towards 111.09, 109.23 and 108.12 marks respectively.
GBP/USD: The sterling strengthened against the dollar on Wednesday, as data showing British retail sales unexpectedly surged in August bolstered expectations the Bank of England will lift rates from record lows before year-end. Sterling jumped by almost a cent against the dollar on the publication of the numbers, which showed monthly sales growth accelerated to 1.0 percent, the fastest since April and easily beating forecasts of a 0.2 percent increase. The pair was trading around $1.3499 marks.
AUD/USD: The Australian dollar backtracked to $0.7960, from a peak of $0.8101. Pair made intraday high at $0.8035 and low at $0.7960 marks. Immediate support was seen at $0.7939 mark while resistance was seen at $0.8035 mark.
NZD/USD: The New Zealand dollar was down 0.4 percent at $0.7331, its rally the previous day losing steam against a broadly stronger dollar. Today New Zealand release GDP data. NZ Q2 s/adj production based GDP +0.8 pct on previous quarter (poll +0.8 pct).
Equities Recap
Japan’s Nikkei was trading 0.32 percent higher at 20,375 points.
Hong Kong’s Hang seng was trading 0.03 percent higher at 28,137.29 points.
Australia’s S&P/ASX 200 was trading 0.87 pct lower at 5,659.30 points.
Shanghai composite index to open flat at 3,364.70 points and China's CSI300 index to open flat at 3,843.26 points.
Taiwan stock was trading around 0.69 pct higher at 10,592.58 points.
India’s NSE Nifty was trading around 0.52 percent lower at 10,088.55 points and BSE Sensex was trading at 0.48 percent lower 32,236.91 points.
South Korea’s Kospi was trading at 0.08 percent lower at 2,410 points.
Commodities Recap
Oil markets dipped on Thursday, weighed down by rising U.S. crude inventories and production as well as a stronger dollar, which potentially hampers fuel consumption in countries that use other currencies at home. Brent crude futures, the international benchmark for oil prices, were at $56.13 a barrel at 0134 GMT, down 16 cents, or 0.3 percent, from their last close. U.S. West Texas Intermediate (WTI) crude futures were at $50.68 per barrel, down 1 cent from the last settlement.
Gold dropped to its lowest level in over three weeks on Thursday as a stronger dollar and increasing prospects of a December rate hike by the Federal Reserve curbed appetite for the metal. Spot gold was down 0.1 percent at $1,299.31 an ounce at 0326 GMT, after earlier touching its lowest since late August at $1295.65. U.S. gold futures for December delivery fell 1 percent to $1,302.60 an ounce.
Treasuries Recap
The Australian bonds plunged on Thursday; following weakness in the U.S. counterpart after the Federal Reserve announced its policy decision yesterday, announcing that it will begin its balance sheet normalization next month.
The yield on the benchmark 10-year Treasury note, which moves inversely to its price, jumped 2-1/2 basis points to 2.86 percent, the yield on 15-year note also surged 2-1/2 basis points to 3.15 percent and the yield on short-term 2-year also traded 1-1/2 basis points higher at 2.03 percent by 03:30GMT.
Yields on New Zealand's 10-year paper have climbed 33 basis points in little more than a week to hit their highest since May at 3.08 percent.
