Asia Forex news roundup: Biden and Xi are holding a virtual meeting.
Tuesday, November 16, 2021, forex news for Asia trade
Presidents Xi of China and Biden of the United States held a virtual summit Monday evening (US time) / Tuesday morning (China time). While we await readouts from both sides, initial’meet and greet’ reports were positive, with both parties offering optimistic sentiments. This is, of course, unsurprising given that the public portion of the summit is not where the difficult problems are discussed; as I write, confidential negotiations are still occurring.
FX markets, on the other hand, responded positively, with yen crosses rising. As did the USD/JPY (to around 114.30) and, most importantly, the AUD/USD (to just above 0.7365). GBP, NZD, and CAD all rose against the dollar, while the EUR remained a laggard, rising only little against the USD.
The Chinese yuan was also strong, both on and off the market (CNY and CNH). The yuan rose as a result of reports in Chinese media that the onshore yuan was expected to deviate from the USD index. Given the strength of the USD, this suggested even more yuan strength, which we later saw.
The governor of the Reserve Bank of Australia, Philip Lowe, spoke today, providing a little more precise guidance than in the past on what kind of measures the Bank is looking at for any rate hikes that may be on the horizon… albeit they are still a long way off.
During the session, the crypto complex fell even lower. As I write this, BTC/USD is around $61,000. Remarks from Twitter’s CFO about being worried of its volatility, as well as from China’s state planner (the NDRC) pledging greater crackdowns, did not bode well for the company.
The AUD/JPY exchange rate surged ahead of the Xi-Biden conference.
ANZ/Roy Morgan survey of consumer sentiment down nearly 3% on the week.
- Inflation expectations may be weighing, given the headlines that followed the rise in US CPI.
- Weekly inflation expectations and its 4-week moving average rose 0.1ppt to 5.0%.
NASDAQ and Dow close lower. S&P trades near unchanged
- Dow industrial average -12.86 points or -0.04% at 36087.44
- S&P index – 0.03 points or 0.00% at 4682.82
- NASDAQ index fell -7.10 points or -0.04% at 15853.86
Markets News :
- GBP leads, NZD lags on the day
- European equities a little higher; S&P 500 futures flat
- US 10-year yields down 0.8 bps to 1.613%
- Gold up 0.4% to $1,870.30
- WTI up 0.6% to $81.38
- Bitcoin down 5.7% to $61,000