23 Jun 2014
Asia Recap: AUD surges on China HSBC PMI
FXStreet (Bali) - The Asian trading was dominated by Aussie strength and further USD weakness.
A 7-month high in China's HSBC PMI (50.8 vs 49.7 exp) got things into motion in the FX arena, with the Aussie, and to a lesser degree the Kiwi, surging as risk sentiment returned in earnest, while the USD continues being dumped.
Hongbin Qu, Chief Economist, China & Co-Head of Asian Economic Research at HSBC, said: "The improvement was broad-based with both domestic orders and external demand sub-indices in expansionary territory."
AUD/USD broke above the sticky resistance at 0.9430, settling comfortably above the level after hitting its highest since April 10th. NZD/USD followed suit, peaking at 0.8775. USD/CAD was also hit hard, tripping stops below 1.0750, leading to a 25 pips slide towards 1.0725. GBP/USD resumed its uptrend by making a high of 1.7037 after a retest of 1.70 whole number last Friday. USD/JPY weakened to post a low of 101.90. EUR/USD remains stuck around 1.36.
Over the weekend, we also had dovish headlines from the ECB, with Nowotny saying it is unlikely the Central Bank will raise rates until 2016, while Draghi said that QE may start on a deterioration of inflation expectations in the medium term. In England, BoE's Miles kept his hawkish tone, saying "is more likely that normalisation of policy starting at some point in my remaining year on the MPC."
Main headlines in Asia
ECB's Nowotny: ECB unlikely to raise rates until 2016
ECB's Draghi: QE to start on deterioration of inflation expectations
Three significant adjustments in the latest CFTC report - BBH
BoE's Miles keeps talking up interest rates
BoE's Haldane: New normal for rates closer perhaps to 2-3%
China's Beige Book: Slowdown deepening on weak investment
China's HSBC PMI hits a 7-month high
Japan's flash PMI: Growth for first time in 3 months
A 7-month high in China's HSBC PMI (50.8 vs 49.7 exp) got things into motion in the FX arena, with the Aussie, and to a lesser degree the Kiwi, surging as risk sentiment returned in earnest, while the USD continues being dumped.
Hongbin Qu, Chief Economist, China & Co-Head of Asian Economic Research at HSBC, said: "The improvement was broad-based with both domestic orders and external demand sub-indices in expansionary territory."
AUD/USD broke above the sticky resistance at 0.9430, settling comfortably above the level after hitting its highest since April 10th. NZD/USD followed suit, peaking at 0.8775. USD/CAD was also hit hard, tripping stops below 1.0750, leading to a 25 pips slide towards 1.0725. GBP/USD resumed its uptrend by making a high of 1.7037 after a retest of 1.70 whole number last Friday. USD/JPY weakened to post a low of 101.90. EUR/USD remains stuck around 1.36.
Over the weekend, we also had dovish headlines from the ECB, with Nowotny saying it is unlikely the Central Bank will raise rates until 2016, while Draghi said that QE may start on a deterioration of inflation expectations in the medium term. In England, BoE's Miles kept his hawkish tone, saying "is more likely that normalisation of policy starting at some point in my remaining year on the MPC."
Main headlines in Asia
ECB's Nowotny: ECB unlikely to raise rates until 2016
ECB's Draghi: QE to start on deterioration of inflation expectations
Three significant adjustments in the latest CFTC report - BBH
BoE's Miles keeps talking up interest rates
BoE's Haldane: New normal for rates closer perhaps to 2-3%
China's Beige Book: Slowdown deepening on weak investment
China's HSBC PMI hits a 7-month high
Japan's flash PMI: Growth for first time in 3 months