Asia Roundup: Asian Markets Trading on a Mix Note As Many Markets Shut Globally to Mark Good Friday - Friday, March 25th
- Japan Fin Min Aso – Not thinking about compiling extra budget, no truth to reports of spending vouchers for young people, economic fundamentals solid, labor market and incomes continue to improve.
- BoJ Policy Board Harada – No asset bubble in Japan, interest rates will rise when Japan’s economy recovers, structural reform not BoJ job.
- Forecasters - BoJ April Tankan to show business confidence ebbing – Nikkei.
- Japan February core CPI unchanged y/y, Tokyo March core -0.3%, +0.1% and -0.2% eyed, Tokyo core fall largest in almost three years, Feb overall nationwide CPI +0.3% y/y, March Tokyo -0.1%, no change in trend excluding energy effects, February nationwide core-core index +0.8% y/y.
- MoF flow data week-ended March 19 – Japanese buy net Y314.7 bln foreign stocks, Y2.2768 trln bonds, sell Y270.3 bln bills; foreign investors sell net Y677.6 bln Japanese stocks, Y561.0 bln JGBs, buy Y1.5073 trln bills.
- Japan fund end-Dec ’15 foreign bond holdings Y1.3353 trln, BoJ JGB holdings total Y331 trln, new record, offshore JGB holdings Y110 trln, 10.6% of total.
- Japan Feb corporate service price index +0.2% y/y to 102.5.
- More Japanese companies enjoying zero-interest fund procurement – Nikkei.
- Japan Post Bank to up deposit limit to Y13 mln from Y10 mln April 1.
- Foreign CB US debt holdings +$4.403 bln to $3.256 trln March 23 week, Tsy holdings +$5.747 bln to $2.942 trln, agencies -$415 mln to $265.863 bln.
- NY Fed – Swaps with foreign CBs $53 bln March 23 week, all with ECB.
- PBOC advisor Huang – RMB will come under pressure on sharp USD rise, China has more room to act in fiscal policy than monetary policy, concerned over non-performing loans.
- Lipper – US-based stock funds take in at 2 bln in latest week, EM funds attract most money in three years.
Economic Data Ahead
- (0345 ET/0745 GMT) France Q4 GDP – final, +1.0% AR eyed; prelim +0.3% q/q, +1.0% AR.
- (0345 ET/0745 GMT) France March INSEE consumer confidence index.
- (0830 ET/1230 GMT) US Q4 PCE prices final, +0.4% AR eyed; prelim +0.4%.
- (0830 ET/1230 GMT) US Q4 core +1.3% AR eyed; prelim +1.3%.
- (0830 ET/1230 GMT) US Q4 GDP deflator – final, +0.9% eyed; prelim +1.0%.
- (0830 ET/1230 GMT) US Q4 corporate profits,-2.5% q/q eyed; last -1.7% q/q, -5.1% y/y.
Key Events Ahead
- Most major centers in region and worldwide closed for Good Friday.
USD: The dollar eked out a modest rise on Friday for its fifth straight day of gains, the longest in almost a year, although it came off highs in late trading after weak U.S. economic data. The dollar turned flat in afternoon U.S. trading on "pre-holiday positioning" and after data showed a fall in U.S. durable goods orders and a slight uptick in the number of Americans filing for unemployment benefits. Earlier, the greenback hit an eight-day high of 96.364. The dollar index was last at 96.133. It has risen for five days straight and is up just over 1 percent this week.
EUR/USD: The euro hit an eight-day low of $1.1144, having lost nearly 1 percent so far this week, with attacks in Brussels on Tuesday bruising sentiment. It was last down 0.1 percent at $1.1153. Pair remains supported below $1.12 marks and trading around $1.1158. Intraday bias remains bearish till the time pair holds key resistance level at $1.1217. A daily close above key resistance will drag the parity towards $1.1342/ $1.1376 marks. On the down side, key support level is seen at $1.1159/ $1.1057 marks.
USD/JPY: Japanese Yen hits fresh weekly low at 113.32 against US dollar. The greenback retreated to a 17-month low of 110.67 last week after the Fed reduced its rate hike projections for this year. Japanese Yen breaks key resistance at 112.60 and supported around 112.84 levels. On the top side, key resistance levels are seen at 114.87/115.96 levels. A daily close below key support level at 111.31 will drag the parity down towards at 110.66/ 108.75/107.51 marks thereafter. Today Japan released Tokyo Core CPI data with negative numbers at -0.3% m/m vs -0.1% previous release. In addition, National Core CPI data remains unchanged at 0.0% m/m vs 0.1% expected.
GBP/USD: Sterling was last up 0.3 percent to $1.4112. Sterling rose against the dollar for the first time this week, as the pound benefited from U.K. retail sales numbers that exceeded expectations. The dollar gained more than 2 percent against the pound this week as the odds of a British exit from the EU have increased in the wake of the attacks in Brussels. Yesterday pair breaks key support at $1.4146, turns the bias slightly bearish and dragged the parity down at $1.4057 marks. On the other side, a daily close above $1.4357 will take the parity up towards key resistances at $1.4504/$1.4602.
AUD/USD: The Australian dollar remained steady on Friday after suffering its biggest one-day fall in nearly a month as a broadly firmer greenback took a toll on commodity prices. Even with Wednesday's 1.2 percent fall, the Aussie is still up around 5 percent this month. It last stood at $0.7510, down 0.3 percent on the day and pulling further away from an 8-1/2 month high of $0.7681 set on Friday. Australian dollar was trading 0.32% lower at $0.7515 on Friday. Intraday bias remains bearish till the time pair holds key resistance at $0.7553 levels. A sustained close above it will drag the parity up towards 0.7725 levels. On the downside, a sustained break below $0.7533 support levels will turn bias back to the downside for retesting 0.7365 low.
NZD/USD: The New Zealand dollar hovered just around 67 U.S. cents after four days of declines. It found a bit of support when New Zealand's monthly trade surplus came in higher than expected. Pair breaks key support level at $0.6750 marks and trading around $0.6690 levels. Short term bias remains bearish for the moment. Key support was found at $0.6585, with resistance at $0.6885 levels.
The Japan’s Nikkei 225 index was trading 0.43% higher at 16,965.38 points. In Japan, National core CPI was flat year-on-year in February, missing expectations for a 0.1% gain, while National CPI gained a more than expected 0.3%. Shanghai composite index to open down 0.2 pct at 2,956.20 points. China’s CSI300 was trading 0.20% higher at 3188 points. South Korea's Kospi index fell 0.06% to 1,985.89 points on Thursday. Taiwan index was open up 0.2 pct at 8,758.14 points and was trading 0.45% lower at 8704 points.
Crude oil was trading to the downside by over 2% before making a comeback to recover just shy of 1.5%. Earlier in the day, U.S. crude futures slid 4 percent and Brent below $40 a barrel, extending bearish sentiment from Wednesday when the U.S. government reported a crude inventory build three times above market expectations. But data later on Thursday from oil services firm Baker Hughes, showing U.S. oil drillers cutting 15 rigs this week after a pause last week, boosted sentiment. The U.S oil rig count now stands at 372, the lowest since November 2009. Gold was on track for a 2.6 percent weekly loss, largely because of Wednesday's 2.3 percent decline. London and many other gold markets will be closed on Friday and Monday for the Easter holiday.
New Zealand government bond prices edged up, sending yields 2.5 basis points lower along the curve. Australia three-year bond futures rose 4 ticks to 98.020, while the 10-year contract put on 6.5 ticks to 97.4150.
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