- Slim majority of Japan firms now favour more BOJ ease, 53% for, 47% against, 66% say Abenomics losing momentum, 6% see momentum gone.
- Japan PM Abe - Investment growth small relative to corporate profits.
- MoF flow data week-ended Oct 10 - Japanese buy net Y105.0 bln foreign stocks, trln bonds, Y18.9 bln bills; foreign investors buy net Y521.1 bln Japanese stocks, trln bonds, Y863.4 bln bills.
- Cleveland Fed Mester - Renews call for US rate hike, economy can handle it, US job growth not as bad as it looks economies more global but Fed still needs to set policy on domestic economy, opposing Fed views reflect economic cross-currents.
- Foreign CB US debt holdings -$14.099 bln to $3.314 trln week-ended Oct 14, Treasuries -$14.802 bln to $2.987 trln, agencies -$189 mln to $280.890 bln.
- Lipper - Stock, bond funds attract $5.5 bln over week.
- Australia RBA Stability report - Warns of risks, lax banking standards.
- NZ Q3 CPI +0.3% q/q, +0.4% y/y, +0.2%/+0.3% eyed, non-tradable unchanged, +1.5%.
- (0400 ET/0800 GMT) Italy August trade balance - global, EU; last , bln surpluses.
- (0500 ET/0900 GMT) Euro zone September inflation - final, +0.2% m/m, -0.1% y/y eyed; flash unchanged, -0.1%.
- (0500 ET/0900 GMT) Euro zone September ex-food/energy, +0.5% m/m, +0.9% y/y eyed; flash +0.3%, +0.9%.
- (0500 ET/0900 GMT) Euro zone August trade balance; last E31.4 bln surplus.
- (0915 ET/1315 GMT) US September industrial output, -0.2% m/m eyed; last -0.4%.
- (0915 ET/1315 GMT) US September capacity utilization, 77.4% eyed; last 77.6%.
- (1000 ET/1400 GMT) US August JOLTS job openings, 5.63 mln eyed; last 5.75 mln.
- (1000 ET/1400 GMT) US Oct UOM sentiment index - prelim, 89.0 eyed; last 87.2.
Key Events Ahead
- (0235 ET/0635 GMT) BOJ Gov Kuroda speech in Tokyo.
- N/A Brussels European Council meeting (final day).
- N/A Milan conference, Italy EconMin Padoan/EBRD/IBRD officials to speak.
- N/A UK GBP0.5/2.0/2.0 bln 1/3/6-month treasury bill auctions.
- (0630 ET/1030 GMT) BoE MPC Forbes speech in Brighton, England.
- (0730 ET/1130 GMT) ECB Coeure at Berlin conference.
- (0830 ET/1230 GMT) Canada international securities flow data.
- (1600 ET/2000 GMT) US Tsy int'l capital flows data (TIC report), last $141.9 bln net inflow.
FX Recap
EUR/USD: The euro currency declined against the greenback, pushing the EUR/USD pair lower from its fresh six-week high at $1.1493, as investors assessed the impact of the European Central Bank (ECB) official Ewald Nowotny and US inflation figures coming in marginally above forecast in September. Nothing relevant in terms of economic news is due on the cards in the upcoming European session, except for the final CPI data from the Euro zone. It made intraday high at 1.1394 and low at 1.1359 levels. Initial support is seen around at 1.1015 and resistance at 1.1560 levels.
USD/JPY: The greenback was trading higher before open of the European markets on Friday, as the US inflation figures surprised on the upside on Thursday, raising hopes for the Federal Reserve to step in and raise the interest rates in the world's largest economy. At the same time Japan's industrial production sorely disappointed. Looking ahead, the dollar-yen pair will continue to track the broader market sentiment ahead of the crucial US prelim consumer sentiment and industrial production data which will wrap up this eventful week. Pair made intraday high at 119.24 and low at 118.83 levels. Initial resistance is seen at 123.20 and support is seen at 118.42 levels.
GBP/USD: Cable was trading higher during the Asian session and was seen testing the patience of bears around the $1.55 level as the US dollar remained under pressure. Today is data thin calendar for the UK. Market will focus on US macro economic data for the further movement. Pair made intraday high at 1.5480 and low at 1.5438 levels. Initial support is seen at 1.5107 and resistance is seen around 1.5725 levels.
NZD/USD: The New Zealand dollar traded weaker against the greenback on Friday after markets had a chance to digest the latest inflation figures, which showed little sign of domestic price pressures. The CPI was up 0.3% in the September quarter, coming in slightly higher than the 0.2% rise forecast by markets, which kept the annual change in inflation steady at 0.4%. However, non-tradable inflation was unchanged over the three-month period, and rose at the weakest annual pace in almost 14 years. Pair made intraday high at 0.6885 and low at 0.6819 levels. Initial support is seen at 0.6235 and resistance at 0.6721 levels.
AUD/USD: The Australian dollar traded in negative territory against its US namesake on Friday, after the country's central bank issued its Financial Stability Review that pointed to higher risks in housing and mortgage markets. The central bank added that risks growing in the commercial property sector were due to investor demand, while regulators are seeking a "permanently stronger" level of bank lending standards. Aussie fell 0.60% and traded at $0.7280 against the US dollar, hovering around the freshly hit intraday low. Pair made intraday high at 0.7337 levels and low around 0.7274 levels. Initial support is seen at 0.6908 and resistance at 0.7438 levels.
Equity Recap
Asian indices extend the risk-on rally, with the Nikkei rallying nearly 1% to 18,287. Australia's S&P ASX index gains 0.81% to 5,272.
Shanghai Composite index gains 0.31% to 3,348.
Hong Kong's Hang Seng gains 0.58% to 23,021.
Australia's S&P/ASX 200 index closes up 0.73 pct at 5,268.30 points.
Tokyo's Nikkei average closes up 1.08 pct at 18,291.80.
Treasury Recap
Thailand 35 bln baht, 14-day central bank bond average accepted yield 1.40145 pct.
Thailand 10 bln baht, 2.33-year central bank bond average accepted yield 1.53353 pct.
Australian government bond futures fell, with the three-year bond contract off 3 ticks at 98.200.
The 10-year contract eased 5 ticks to 97.3600, while the 20-year contract also shed 5 ticks to 96.8300.
New Zealand government bonds had a soft tone with yields 2.5 basis points higher along the curve.
Commodity Recap
US crude futures edged up on Friday, as Russia is not ruling out possible production cuts ahead of the OPEC meeting in Vienna next week. Gains came after the market focused on a gasoline and distillate inventory drop, rather than on a surge in crude reserves. Futures for WTI added 1.29% to trade at $46.98 per barrel, while Brent futures were traded 0.99% higher at $50.22 per barrel.
Gold stayed below a 3-1/2-month high on Friday after strong U.S. inflation data supported the dollar, but the metal was set to post its biggest weekly jump in four weeks on bets the Federal Reserve will not hike interest rates this year. Spot gold eased 0.3 percent to $1,179.16 an ounce by 0346 GMT. It had hit a 3-1/2-month high of $1,190.63 in the previous session, but ended the day lower after U.S. inflation and jobless claims data calmed some concerns about the strength of the U.S. economy and boosted the dollar.
