- BOJ leaves policy/economic assessment as is, vote 8-1, Kiuchi again dissents, for JGB buy taper to Y45 trln/year, inflation around zero for now on energy.
- RBA - Accommodative policy appropriate, past AUD fall to support economy, reasonable chance AUD will decline further once Fed ups US rates, GDP forecast trimmed, +2-3% '15-16, '17 3%+, population growth slowing, inflation 2-3% to end-'17, China risks tilted to downside.
- Australia June owner-occupied housing finance +4.4% m/m, investment at -0.7%.
- Australia July PCI +0.7 pt to 47.1, sub-50 however and still in contraction.
- NZ Fonterra forecasts '15/26 total payout at NZ$4.25-4.35, farmgate milk prices from NZ$5.25/kg to NZ$3.85, volume likely 2% lower.
- BoE MPC Broadbent - No urgency to raise rates.
- Japan Finance Minister Aso - IMF adoption of CNY to SDR desirable but decision should be based on objective data.
- Japan end-July foreign reserves $1.242 trln, off $616 mln, MoF confirms no FX intervention April-July.
- China growth probably half reported rate or less say sceptics.
- Foreign CB US debt holdings +$6.076 bln to $3.358 trln August 5 week, Treasury holdings +$6.721 bln to $3.017 trln, agencies -$1.089 bln to $295.738 bln.
- NY Fed - Swaps with foreign CBs total Y308 mln August 5 week, all with ECB.
- US-based stock funds post $3.6 bln outflows latest week, money market funds attract $20.3 bln.
- Oil trader Hall's fund down $500 mln in second worst month ever.
- US firms may be hiring but lid on wages, investment hits productivity.
- UK July hiring slowest in 2 yrs+, starting salary growth at 18-month low.
- (0245 ET/0645 GMT) France June industrial output, +0.2% m/m eyed; last +0.4%.
- (0245 ET/0645 GMT) France June trade balance, E 3.6 bln deficit eyed; last E 4.0 bln deficit.
- (0245 ET/0645 GMT) France June budget balance; last E63.9 bln deficit.
- (0300 ET/0700 GMT) Spain June industrial output, +3.9% y/y eyed; last +3.4%.
- (0400 ET/0800 GMT) Norway June manufacturing output, +1.1% m/m eyed; last -2.1%.
- (0400 ET/0800 GMT) Norway June credit indicator, +6.0% y/y eyed; last +5.9%.
- (0430 ET/0830 GMT) UK June trade balance, GBP9.3 bln deficit eyed; last GBP8.0 bln deficit.
- (0430 ET/0830 GMT) UK June non-EU, GBP2.4 bln deficit eyed; last bln deficit.
- (0830 ET/1230 GMT) US July non-farm payrolls, +223k eyed; last +223k.
- (0830 ET/1230 GMT) US July unemployment, 5.3% eyed; last 5.3%, participation 62.6%.
- (0830 ET/1230 GMT) US July average earnings, +0.2% m/m eyed; last unchanged.
- (1300 ET/1700 GMT) US June Dallas Fed trimmed mean PCE; last +2.3%.
- (1500 ET/1900 GMT) US June consumer credit, $17.0 bln eyed; last $16.09 bln.
Key Events Ahead
- Singapore market holidays today and Monday.
- (0230 ET/0630 GMT) BOJ Gov Kuroda press conference.
- N/A UK DMO GBP0.5/1.5/2.0 bln 1/3/6-month treasury bill auctions.
FX Recap
EUR/USD is supported above 1.0900 levels and currently trading at 1.0920 levels. It has made intraday high at 1.0929 and low at 1.0909 levels. Yesterday euro jumped to fresh daily highs after upbeat German factory data for June came in far better than anticipated. The pair keeps the weekly range below the 1.1000 handle, against a backdrop of a cautious tone from investors in light of relevant releases in the US economy and ahead of the critical Non-farm Payrolls due later today. Investors got an insight into Friday's non-farm payrolls report overnight with the release of the Automatic Data Processing (ADP) employment figures, which showed 185,000 job gains for July, missing the expected gain of 216,000. US ISM non manufacturing PMI data released with positive numbers at 60.3 mm vs 56.0 previous release. Initial support is seen around at 1.0789 and resistance at 1.1195 levels.
USD/JPY is supported above 124.00 levels and posted a high of 124.82 levels. It has made intraday low at 124.65 and currently trading at 124.77 levels. The Bank of Japan has kept policy settings unchanged since October when the central bank last expanded its Qualitative and Quantitative Easing (QQE) program, which currently has the monetary base expanding at a rate of around ¥80 trillion per year. The latest inflation figures show Japan's core CPI rising only 0.1% year-on-year in June, and Tokyo's more timely inflation index sliding 0.1% in July. On Friday the bank said inflation is likely to remain at current levels for the time being, while the bank's most recent economic forecasts - given on July 15 - have inflation coming close to the 2% target by fiscal 2016. Initial resistance is seen at 125.68 and support is seen at 120.63 levels.
GBP/USD is supported above $1.5500 levels. It made an intraday high at 1.5524 and low at 1.5499 levels. Pair is currently trading at 1.5521 levels. Yesterday BOE kept the interest rate and asset purchase facility unchanged as expected. The Bank of England's nine-strong rate-setting committee saw the first split since December last year, as Ian McCafferty voted for a 25 basis point rate hike at the August meeting. Today UK trade balance as well as most awaited US NFP job data will be in focus. Initial support is seen at 1.5413 and resistance is seen around 1.5734 levels.
NZDUSD is supported below 0.6600 levels and trading at 0.6563 levels and made intraday low at 0.6529 and high at 0.6568 levels. The kiwi recovered from its six-year lows seen in the previous session, when it was flattened by weak New Zealand jobs figures and the strongest US ISM data since 2005. Pair trades almost unchanged in the mid-Asian, swiftly recovering from a dip to session lows following the Fonterra's payout forecast cut and also the farm support plan announcement. Fonterra announced, "Farmgate milk price forecast has been reduced from $5.25 kgms to $3.85 per kgms. Co-operative has announced $4.25 - $4.35 forecast total available for payout for 2015/16. It has reduced its New Zealand milk volume forecast for 2015/16 season to 1,589 million kgms, 2 per cent lower than the previous season". Moreover, the dairy giant also announced the new measures to support the dairy industry, a Co-operative Support Program of an additional 50 cents per shared-up kilogram of milk solids to support farmers this season. However, the upside remains capped on the back of a broadly higher US dollar ahead of the key US NFP data due later in the US session. Initial support is seen at 0.6465 and resistance at 0.6789 levels.
USDCHF is supported above 0.9800 levels and currently trading at 0.9810 levels. Pair made in intraday high at 0.9815 and low at 0.9802. The Swiss currency was persistent sold-off versus the US dollar, pushing USD/CHF to fresh four-month highs beyond 0.98 handle, as markets continue to favour the US dollar ahead of a key US jobs reports. Swiss CPI figures which revealed that consumer prices in Switzerland failed to rebound in July and slid into negative territory on a monthly basis as well. To the topside, the next resistance is located at 0.9850 levels and to the downside, immediate support might be located at 0.9769 (Today's Low) levels and below that at 0.9700 levels.
AUD/USD is supported below 0.7400 levels and trading at 0.7360 levels. It has made intraday high at 0.7399 levels and low at 0.7340 levels. The Australian dollar lifted against the greenback on Friday after the Reserve Bank of Australia released its quarterly Statement on Monetary Policy, which contained confirmation that the bank was happier with the recent depreciation of the Australian currency. The RBA's quarterly Statement on Monetary Policy noted that "there are increasing signs that the depreciation of the exchange rate is providing additional support to demand for domestically produced goods and services, which should in time lead to more investment." Initial support is seen at 0.7225 and resistance at 0.7647 levels.
Equity Recap
Japan's benchmark Nikkei 225 index slipped 0.34% to 20,593.48 points within the first hour of trade, while Tokyo's broader Topix gauge fell 0.38% to 1,667.24 points.
Hong Kong's benchmark Hang Seng index crept up 0.08% to 24,395.98 points at the opening bell, and mainland China's benchmark Shanghai Composite rallied 1.21% to 3,705.89 points at the same time.
Korea's benchmark Kospi index lost 0.31% to trade at 2,007.01 points this morning in Seoul.
The benchmark Australian S&P/ASX 200 index went into free-fall, plunging 1.89% to 5,504.30 points in Sydney, with the heavily-weighted banks trading sharply lower.
New Zealand's benchmark S&P/NZX 50 index fell 0.55% to 5,898.80 points this afternoon in Wellington.
The Indian market is still flat but the Nifty is nearing 8600. The 50-share index is up 4.70 points at 8593.35 and the Sensex is up 9.10 points at 28307.23.
Australia's S&P/ASX 200 index closes down 2.20 pct at 5,486.90 points.
Tokyo's Nikkei average closes up 0.29 pct at 20,724.56.
Treasury Recap
BOJ offers to lend Y400 bln of JGBs on spot basis through 8/10 as a secondary source of JGBs (Offer in the morning).
Thai 40 bln baht, 14-day central bank bond average accepted yield 1.40171 pct.
10-Year US treasury yield at 2.232 percent vs US close of 2.234 percent on Thursday.
Commodity Recap
Gold steadied near a 5-1/2-year low on Friday and was on track to show a loss for the seventh week in a row, its longest such slump since 1999, ahead of U.S. data that may determine how soon the Federal Reserve raises interest rates. Spot gold was flat at $1,089 an ounce at 0244 GMT. The metal has been trading below $1,100 since breaching that support in a July 20 rout, sinking as far as $1,077 on July 24, its weakest since February 2010. Bullion was down 0.6 percent on the week, with a seventh weekly loss in a row matching a similar losing streak in May-June 1999.
Oil prices were trading in the green zone on Friday, but still heading for huge weekly losses, mainly thanks to global oversupply and a strong dollar. Futures for WTI were traded with a 0.47% gain at $44.87 per barrel, while Brent futures climbed 0.48% to $49.76 per barrel.
