Forex news for Asia trading Tuesday 19 January 2016

China:

  • On today's China GDP ... 'Measures to revive the economy have largely failed'
  • Westpac on China Q4 GDP: loss of momentum ... a disappointing result
  • More from China's Stats chief - Yuan depreciation will not become a trend
  • Comments from China's NBS' Wang: China's GDP figures are credible
  • USD/JPY, AUD/USD lower in wake of China GDP
  • China Dec. Industrial production: 5.9% y/y (vs. expected 6.0%) + retail sales data & more
  • China Q4 GDP: 6.8% y/y (6.9% expected)
  • China - early leak of GDP (treat with care): 6.9%
  • China stockmarket opening indications - Shanghai Comp to open flat
  • PBOC sets USD/CNY central rate at 6.5596
  • China GDP due at 0200GMT - let's be having your guesses!
  • PBOC's crawling peg is flawed, should be abandoned - more detail
  • Comments from BOJ's Kuroda: BOJ will continue easing until 2% inflation stable
  • Japan PM Abe: Fundamentals of Japan economy firm
  • EUR/USD technical analysis - "tracing a head and shoulders"
  • NZD traders - heads up for the dairy auction during London time
  • Australian press: RBA tipped to cut rates in June
  • Japan's government preparing legislation to allow GPIF to directly buy & sell stocks
  • US 10-yr note drops for 1st time in 5 days
  • Japan finance minister Aso: Japan firms' fundamentals sound
  • CAD - Moody's changes outlook to negative for Alberta
  • Australia - ANZ Roy Morgan Weekly Consumer Sentiment: 113.2 (prior 114.1)
  • Fitch Ratings maintains stable outlook on Australia's banking sector in 2016
  • Sweden - Riksbank review recommends changing inflation target
  • Trade ideas thread for Tuesday 19 January 2016
  • Big jump in NZ business confidence in Q4, from -14 to +15

A sedate sort of session ahead of the awaited Chinese GDP data for Q4. While traders are wary of the veracity of Chinese data, and rightly so, the announcement does have an impact and we are here to trade it.

The yuan fixing was once again stable, and Chinese stocks opened more or less flat for the day.

The Q4 GDP came in a shade below the 6.9% consensus expectation at 6.8% for the year for Q4. Simultaneous monthly data on industrial production, retail sales and asset investment for December all came in at a miss also.

Investors aren't naive, though. They won't be taking the data at face value, its no secret that Chinese data is ... errr ... questionable. Very. But, the direction (down) of the data at least points to whats going on in China.

The world's favourite China proxy, the AUD, chopped around in a 40-odd point range after the data before settling a little lower. After some time around 0.6840/50 it then steadily gained toward 0.6880, where it sits just below as I update.

Chinese stocks gained, helped along by regulations such as large shareholders having to give a 15 day notice period of an intention to sell, as well as sellers facing police investigation. The very opposite of financial market liberalisation.

USD/JPY traced out a similar pattern; down after the China data and then back up again to be just off day's highs as I update. EUR/JPY is near session highs also. USD/CHF - similar and EUR/USD a mirror (more or less).

Gold dropped about $4 prior to the Chinese data but has since recovered to little changed overall on the session.

Cable too, little changed.

Regional equities with Shanghai closed for the lunch break:

  • Nikkei -0.5%
  • Shanghai +1.64%
  • HK +0.78%
  • ASX +0.82%

Still to come:

  • NZD traders - heads up for the dairy auction during London time