Around the Forex World in 5 Minutes

Around the Forex World in 5 Minutes

Around the Forex World in 5 Minutes

Let's begin with ASIA:

Asia traded mostly positive, tracking the oil inspired gains seen on Wall St., where WTI rose above USD 41/bbl and the Dow snapped a 7-day losing streak. ASX 200 (+0.3%) was underpinned by the gains in energy after oil’s 3% surge whilst mining names also supported the advances in Australia. Nikkei 225 (+0.3%) saw choppy trade with fluctuations in JPY driving price action. Chinese markets are mixed with bargain-buying observed in the Hang Seng (+0.3%), while the Shanghai Comp (-0.2%) is in the red following a reserved liquidity injection and after yesterday’s NDRC comments regarding lower rates and RRR were retracted from the statement.

Bank of Japan's Deputy Governor Iwata stated the policy review next month is to focus on monetary transmission mechanism and hurdles to the success of its stimulus plan.

Peoples Bank Of China injected CNY 50bln via 7-day reverse repos. PBoC set CNY mid-point at 6.6444 (Prev. 6.6195).

Fly over to EUROPE:

ECB's Weidmann (Hawk) stated that there are possibilities to altering the QE programme.

According to a treasury spokesman, the Italian economy minister has signed a decree which activates the state guarantee on bad loan sales.

Then the UK:

A woman in her 60s has died and five other people have been injured after a man allegedly 'went on the rampage' with a knife in central London. London Metropolitan Police stated that mental health was a key factor behind the stabbing attack in Russell Square but adds that terrorism is still a line of enquiry. City A.M.’s BpE Shadow MPC voted 5-4 in favour of slashing rates to a new all-time low of 0.25 per cent. (CityAM)

What's going on with the FX markets?

In FX markets, the surge in oil prices gave a lift to commodity-linked currencies, with AUD/USD climbing above the 0.7600 level, while NZD and CAD also outperformed. Elsewhere, USD/JPY saw choppy price action and failed to sustain a rebound after meeting resistance around the 101.35 level, which saw the pair briefly retreat below 101.00.

Fitch affirmed Canada at AAA with outlook stable. Australian Retail Sales (Jun) M/M 0.1% vs. Exp. 0.4% (Prev. 0.2%) Q/Q 0.4% vs. Exp. 0.5% (Prev. 0.5%).

The COMMODITIES area:

Oil extended on yesterday’s over 3% advances in which WTI gained a foothold above the USD 41/bbl. The metals complex suffered overnight with safe-haven gold (-0.6%) pressured amid increased risk-appetite and silver also weighed in sympathy, while copper saw relatively subdued price action.

CME reduced WTI crude margins by 5.9% for September and October to USD 3200 per contract from USD 3400 per contract. Iraq's crude oil output in July rose to 4.632mln bpd. (Newswires)

And finally – The US

Fed's Evans (Non-voter, dove) stated that one rate hike this year could be appropriate and went on to say that the US economic fundamentals are good. Fed's Kashkari (Non-voter) stated that he does not see much inflationary pressure. 

Are you ready for the NFP tomorrow, August 5th?

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