Asia roundup: Aussie eases on rate cut forecast, Dollar rallies against Yen on Trump trade deal comments, Asian shares surge - Wednesday, November 27th, 2019
Source: FxWire Pro - Media Round Ups / 27 Nov 2019 02:16:21 America/New_York
- Oil dips after U.S. stock build
- Gold eases as Trump's remarks
- RBA seen cutting rates twice, introducing QE in 2020: Westpac
- RBNZ's semi-annual review gives no update on monetary policy
Economic Data Ahead
- No major economic data releases
Key Events Ahead
- (0430 ET/0930 GMT) ECB Lane’s speech
DXY: The dollar index rose after tumbling in the previous session on downbeat U.S. economic data. The U.S. consumer confidence fell for a fourth straight month in November amid worries about current business conditions and employment prospects, while sales of new U.S. single-family homes and goods trade deficit unexpectedly fell in October. The greenback against a basket of currencies traded 0.1 percent up at 98.35, having touched a high of 98.38 on Monday, its highest since November 14.
EUR/USD: The euro declined, reversing most of its previous session gains, as weak eurozone data continued to dent investor risk sentiment. The European currency traded 0.1 percent down at 1.1009, having touched a low of 1.1003 on Monday, its lowest since November 14. Investors’ attention will remain on a series of data from the eurozone economies and ECB Lane's speech, ahead of the U.S. personal consumption expenditure, core-personal consumption expenditure, durable goods, personal income, personal spending, unemployment benefit claims, gross domestic product price index and pending home sales. Immediate resistance is located at 1.1040 (10-DMA), a break above targets 1.1065 (21-DMA). On the downside, support is seen at 1.0995, a break below could drag it below 1.0966.
USD/JPY: The dollar surged, extending gains for the sixth straight session, as upbeat signals from U.S.-China trade talks fanned hopes of an easing of tariff hostilities. On Tuesday, U.S. President Donald Trump said the United States and China are close to agreement on the first phase of a trade deal after top negotiators from both the countries spoke by telephone and agreed to keep working on remaining issues. The major was trading 0.1 percent up at 109.15, having hit a high of 109.20 on Tuesday, its highest since November 12. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. personal consumption expenditure, core-personal consumption expenditure, durable goods, personal income, personal spending, unemployment benefit claims, gross domestic product price index and pending home sales. Immediate resistance is located at 109.25 (November 5 High), a break above targets 109.48 (November 7 High). On the downside, support is seen at 108.87 (Nov. 26 Low), a break below could take it near at 108.69 (10-DMA).
GBP/USD: Sterling declined, extending previous session losses, as a Kantar poll published on Tuesday showed Labour had reduced the Conservative advantage to 11 points from 18 over the past week. The major traded 0.2 percent down at 1.2845, having hit a low of 1.2829 on Friday, it’s lowest since November 13. Investors’ attention will remain on the development surrounding the general elections, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2892 (10-DMA), a break above could take it near 1.2930. On the downside, support is seen at 1.2823, a break below targets 1.2794. Against the euro, the pound was trading flat at 85.70 pence, having hit a low of 86.05 on Friday, it’s lowest since Nov. 12.
AUD/USD: The Australian dollar slumped following a forecast from Westpac Bank Chief Economist Bill Evans stating he expected two central bank interest rate cuts and quantitative easing (QE) to be introduced next year. Moreover, data showing profits at China's industrial firms declined in annual terms for the third consecutive month in October further dented the bid tone around the major. The Aussie trades 0.2 percent down at 0.6772, having hit a low of 0.6767 on Tuesday, it’s lowest since October 17. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.6750, a break below targets 0.6715. On the upside, resistance is located at 0.6801 (10-DMA), a break above could take it near 0.6834.
NZD/USD: The Australian dollar eased from a near 1-week peak after the Reserve Bank of New Zealand released its semi-annual review of the financial system but gave no update on monetary policy. The RBNZ said it was ramping up its scrutiny of banks and insurers ahead of its decision on raising bank capital requirements. The Kiwi trades down at 0.6422, having touched a high of 0.6432 earlier, its highest level since November 21. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6449, a break above could take it near 0.6465. On the downside, support is seen at 0.6408 (10-DMA), a break below could drag it below 0.6360.
Asian shares rallied as traders looked ahead to a possible outcome to drawn out U.S.-China trade talks.
MSCI's broadest index of Asia-Pacific shares outside Japan surged 0.2 percent.
Tokyo's Nikkei rose 0.3 percent to 23,437.77 points, Australia's S&P/ASX 200 index gained 0.9 percent to 6,850.60 points and South Korea's KOSPI rallied 0.3 percent to 2,128.44 points.
Shanghai composite index fell 0.2 percent to 2,900.22 points, while CSI 300 index traded 0.5 percent down at 3,871.88 points.
Hong Kong’s Hang Seng traded 0.05 percent lower at 26,98.11 points. Taiwan shares added 0.6 percent to 11,647.46 points
Crude oil prices declined after an industry report showed an unexpected build in U.S. crude inventories, but optimism around the signing of the first phase of a U.S.-China trade deal limited the downside. International benchmark Brent crude was trading 0.1 percent up at $64.20 per barrel by 0544 GMT, having hit a high of $64.30 on Tuesday, its highest since September 24. U.S. West Texas Intermediate was trading flat at $58.29 a barrel, after rising as high as $58.71 on Friday, its highest since September 23.
Gold prices plunged as demand for riskier assets surged after U.S. President Donald Trump said an interim trade deal with China is close. Spot gold was trading 0.2 percent down at $1,458.20 per ounce by 0549 GMT, having touched a low of $1449.92 on Tuesday, its lowest since Nov. 12. U.S. gold futures were unchanged at $1,460.60.
Japanese government bond prices rose after the Bank of Japan board member Makoto Sakurai said the central bank would only consider expanding stimulus if overseas risks triggered a financial crisis. The benchmark 10-year JGB futures rose 0.19 point to 153.51. The 10-year JGB yield fell 1 basis point to minus 0.110 percent. The 20-year JGB yield fell 2 basis points to 0.235 percent. The 30-year JGB yield fell 2 basis points to 0.390 percent, while the 40-year JGB yield was unchanged at 0.440 percent. The five-year yield fell 1 basis point to minus 0.210 percent. At the short end of the yield curve, the two-year JGB yield fell 0.5 basis point to minus 0.195 percent.
The Aussie 10-year yields were now 28 basis points below NZ yields, compared to 11 basis points early this month.© FxWire Pro 2020. All rights reserved. The FxWire Pro content received through this service is the intellectual property of FxWire Pro or its third party suppliers. Republication or redistribution of content provided by FxWire Pro is expressly prohibited without the prior written consent of FxWire Pro, except for personal and non-commercial use. Neither FxWire Pro nor its third party suppliers shall be liable for any errors, omissions or delays in content, or for any actions taken in reliance thereon.
- Oil dips after U.S. stock build