Monday, 9 September 2013

Forex: Dollar Looks to Fedspeak, US Credit Data for QE Taper Clues!

A quiet economic calendar in European trading hours is likely to see investors looking ahead to the US docket. Scheduled commentary from San Francisco Fed President John Williams is in focus. While Mr Williams is not a member of the rate-setting FOMC committee this year, his speech and subsequent Q&A session mark the last bit of “fed-speak” before next week’s monetary policy announcement. Needless to say, this is likely to generate interest considering that sit-down is expected to produce a reduction of the Fed’s QE3 program. Separately, July’s Consumer Credit reading is expected to print at $12.3 billion, down from $13.82 billion in the prior month.

On balance, a small initial cutback of asset purchases this month is probably priced in at this point. Indeed, opting to do nothing this time around might be problematic from a credibility perspective given Fed officials’ considerable efforts to telegraph the move over recent months. That means the object of speculation at this stage is the trajectory of further “tapering” of QE after September’s outing. With that in mind, news-flow arguing against a sustained stimulus reduction cycle through the year-end (such as a dovish tone from Mr Williams or a particularly disappointing Consumer Credit print) is likely to weigh on the US Dollar, and vice versa.

The Japanese Yen gapped down at the open of the trading week and underperformed against its top counterparts as risk appetite swelled overnight, sending stocks higher and boosting demand for carry trades funded in terms of the perennially low-yielding currency. The MSCI Asia Pacific regional benchmark equity index rose 1 percent wake of better-than-expected Chinese Trade Balance data published over the weekend. The report showed that exports rose 7.2 percent year-on-year in August, marking the largest increase in four months and topping forecasts calling for a 5.5 percent increase. The release stoked optimism about economic growth in the world’s second-largest economy. The Australian Dollar outperformed and we remain long AUDUSD.

Asia Session:

GMT
CCY
EVENT
ACT
EXP
PREV
1:30
CNY
Trade Balance (AUG)
28.52B
$20.00B
$17.82B
1:30
CNY
Imports (YoY) (AUG)
7.0%
11.3%
10.9%
1:30
CNY
Exports (YoY) (AUG)
7.2%
5.5%
5.1%
22:45
Manufacturing Activity Volume (QoQ) (2Q)
-3.4%
-
-0.6%
22:45
NZD
Manufacturing Activity (2Q)
-2.0%
-
0.2%
23:50
GDP (QoQ) (2Q F)
0.9%
1.0%
0.6%
23:50
JPY
GDP Annualized (2Q F)
3.8%
3.9%
2.6%
23:50
JPY
Nominal GDP (QoQ) (2Q F)
0.9%
1.0%
0.7%
23:50
JPY
Consumer Spending (QoQ) (2Q F)
0.7%
-
0.8%
23:50
JPY
Business Spending (QoQ) (2Q F)
1.3%
1.1%
-0.1%
23:50
JPY
GDP Deflator (YoY) (2Q F)
-0.5%
-0.3%
-0.3%
23:50
JPY
Current Account Total (¥) (JUL)
577.3B
507.7B
336.3B
23:50
JPY
Adjusted Current Account Total (¥) (JUL)
333.7B
313.9B
646.2B
23:50
JPY
Trade Balance - BOP Basis (¥) (JUL)
-943.3B
-862.4B
-139.2B
23:50
JPY
BoP Current Account Balance (YoY) (JUL)
-12.9%
-27.8%
-20.3%
23:50
JPY
Bank Lending Banks ex-Trust (YoY) (AUG)
2.3%
-
2.3%
23:50
JPY
Bank Lending incl Trusts (YoY) (AUG)
2.0%
-
2.0%
0:00
NZD
QV House Prices (YoY) (AUG)
8.5%
-
8.1%
1:30
CNY
Consumer Price Index (YoY) (AUG)
2.6%
2.6%
2.7%
1:30
CNY
Producer Price Index (YoY) (AUG)
-1.6%
-1.7%
-2.3%
1:30
Home Loans (MoM) (JUL)
2.4%
2.0%
2.6%
1:30
AUD
Investment Lending (MoM) (JUL)
2.9%
-
-0.1%
1:30
AUD
Value of Loans (MoM) (JUL)
0.0%
-
2.4%
1:30
AUD
ANZ Job Advertisements (MoM) (AUG)
-2.0%
-
-1.1%
4:30
JPY
Bankruptcies (YoY) (AUG)
-15.3%
-
-0.1%
5:00
JPY
Consumer Confidence Index (AUG)
43.0
44.0
43.6


Euro Session:

GMT
CCY
EVENT
EXP/ACT
PREV
IMPACT
5:45
Unemployment Rate (AUG)
3.0% (A)
3.0%
Medium
5:45
CHF
Unemployment Rate s.a. (AUG)
3.2% (A)
3.2%
Medium
6:00
JPY
Eco Watchers Survey: Current (AUG)
51.2 (A)
52.3
Low
6:00
JPY
Eco Watchers Survey: Outlook (AUG)
51.2 (A)
53.6
Low
7:15
CHF
Retail Sales (Real) (YoY) (JUL)
0.8% (A)
2.3%
Medium
8:30
Euro-Zone Sentix Investor Confidence (SEP)
-3.5
-4.9
Low


Critical Levels:

CCY
SUPP 3
SUPP 2
SUPP 1
Pivot Point
RES 1
RES 2
RES 3
1.2989
1.3073
1.3126
1.3157
1.321
1.3241
1.3325
1.5394
1.551
1.5572
1.5626
1.5688
1.5742
1.5858


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