Andy Harrison
Good morning,
NYK Close
USDJPY 79.917 | EURUSD 1.23923 | EURJPY 99.036 | AUDUSD 1.02878 | NZDUSD 0.80438 | USDCAD 1.01429 | EURCHF 1.20121 | USDCHF 0.96939 | GBPUSD 1.55254 | EURGBP 0.79821 |
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Harry Hindsight
·        EUR: Stuck in a tight range throughout Asia, early London dropped it down to the 1.2500 level in front of the ECB announcement, as expected they cut by 25bps however, what may have been a little bit more of a shock was they cut deposit rates to 0% this would force the banks to lend more money rather than depositing it at the central banks, the market declined swiftly by about around 125 tics from before the announcement roughly half of the cut. Having bottomed out just above the 1.2360 level it held there and closed close to 1.2390.
·        GBP: BoE announcement barely moved the market from a quiet Asian session we moved up slightly into the London moving above 1.5620 briefly the ECB announcement tipped Cable lower but only to the 1.5560 level before finding EURGBP sellers entering the market, as we moved into the NYK market we’d regained the 1.5600 level only to decline further on the ADP figures Cable again tumbled moving as low as 1.5500 before moving into a sideways market around the 1.5520 level. Given that they added 50bio to QE running to November as usual there was very little effect. One could say we should be taking a leaf out of the Chinese book making it difficult for the Banks to sit on the funds available.
·        JPY: Asia moved from highs above 80.00 to below 79.60 on EURJPY selling for the most part as the far east cut carry trades in front of the ECB announcement, we moved into London with sideway trading as the market was looking a little more balanced, the US ADP figures had the market buying USDJPY moving it from those low areas pushing back to the highs only to settle into a sideways range similar to the beginning of the Asian session.
·        AUD: With steady declines through Asia, the London market reversed and started to move up from the 1.0245 lows again to peak through 1.0320 just after the news that CNY had cut interest rates for the second time in a month. This was swiftly followed by the ADP number reversing the quick rise and moving the market back to 1.0250, we moved from a hectic couple of hours into a holding range around 1.0290 into the close.
·        CNY: It would seem that the PBoC cut for the second time in a month, cutting the 1yr lending rate by 56bps, what you need to see though is the fact that because there is very little demand for loans they have cut the cost of borrowing by a whopping 170bps from 5.9% to 4.2% a little bit of a flip to the western CB.
Yesterday’s premiership results
Actual = A | Consensus = C | Previous = P | Revised = RÂ
01:30Â Â Â Â AUDÂ Â Â Â Â Â Trade Balance (AUD) May A -285M | C -500M | P -203MÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â | R -26M
10:00Â Â Â Â EURÂ Â Â Â Â Â Â German Factory Orders M/M May A 0.60% | C 0.00% | P -1.90%Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â
11:00Â Â Â Â GBPÂ Â Â Â Â Â BoE Rate Decision A 0.50% | C 0.50% | P 0.50%Â Â
11:00Â Â Â Â GBPÂ Â Â Â Â Â BoE Asset Purchase Target A 375B | C 375B | P 325BÂ Â Â Â Â Â Â
11:30Â Â Â Â USDÂ Â Â Â Â Â Challenger Job Cuts Y/Y Jun A -9.40% | P 66.70%Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â
11:45Â Â Â Â EURÂ Â Â Â Â Â Â ECB Rate Decision A 0.75% | C 0.75% | P 1.00%Â Â
12:15Â Â Â Â USDÂ Â Â Â Â Â ADP Employment Change Jun A Â Â Â Â Â Â Â Â Â Â Â Â Â Â 176K | C 100K | P 133KÂ Â
12:30Â Â Â Â USDÂ Â Â Â Â Â Initial Jobless Claims A 374K | C 385K | P 386KÂ Â Â Â
14:00Â Â Â Â USDÂ Â Â Â Â Â ISM Non-Manufacturing Composite Jun A 52.1 | C 53 | P 53.7Â Â Â Â
15:00Â Â Â Â USDÂ Â Â Â Â Â Crude Oil Inventories A -4.3M | C -1.8M | P -0.1MÂ Â Â Â Â Â Â Â Â Â Â
For today
USDJPY:
Topside: 80.05-80.35 light 2-way interest 80.50-80.80 small scaled buy stops
Downside: 79.55-79.85 light sell stops 79.25-79.55 decent bids 78.95-79.20 light mixed
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EURUSD:
Topside: 1.2400-1.2440 decent offers 1.2450-1.2480 small offers 1.2490-1.2520 light buy stops
Downside: 1.2355-1.2380 marginal bids 1.2320-1.2350 medium sized sell stops 1.2270-1.2310 light sell stops Â
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EURJPY:
Topside: 99.40-99.70 decent buy stops AUDUSD:
Topside: 1.0310-1.0345 good staggered buy stops
Downside: 1.0255-1.0280 light mixed 1.0220-1.0245 small bids
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01:30Â Â Â Â AUDÂ Â Â Â Â Â Trade Balance (AUD) May A -285M | C -500M | P -203M | R -26M
JPY:
Japan Azumi: government could run out of money in Oct unless deficit bill passed
Japan Govt: PM Noda Told IMF Lagarde Yen Strength One-Sided, Not Reflecting Fundamentals
Japan Azumi: no change to view that strong yen poses risks
Japan June foreign reserves fall to $1.271 trln
Econ Min Furukawa: Government and BOJ Need to Work Closely to Tackle Deflation
BOJ board won’t get new members in time for next week-govt
EUR:
Liikanen Says ECB Shows It Is Able to Use the Tools It Has
German Ministry Wants ESM to Help Regulate European Banks -Report
CNY:
China may miss 2012 trade growth target-vice premier
China Government Economist: GDP Growth May Slow to Below 7.5% in 2Q – Report
China Commerce Ministry: To Deal With US Cars Consultation Request ‘Appropriately’
SGD/CNY:
Singapore Exchange says ready to trade yuan securities
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·        EUR: Having had the move of the week the market has fallen back into the summer market ranges we all love, opening around the 1.2390 level we’ve taken several hours to drop to 1.2375, but that is all she wrote very quiet.
·        GBP: A quiet opening with very little happening opening around the 1.5525 area dropping down below the 1.5520 level, rumours of fixing demand for GBPJPY saw the market start to rise to above 1.5530 once the fix was over allowing the market to drop back to the lows.
·        JPY: Another quiet day for the JPY USDJPY moved gently from the 79.9 level to peak above 80.00 before dropping into the mid-range area a massive 10 tic range don’t you love it.
·        AUD: With no news to surprise an improving trade balance the market found itself trading contrary moving slowly lower from the 1.0290 level down to below 1.0250
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Today’s data
Consensus = C Previous = P Timings GMT
07:00Â Â Â Â CHFÂ Â Â Â Â Â Â Foreign Currency Reserves Jun P 303.8BÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â
07:15Â Â Â Â CHFÂ Â Â Â Â Â Â CPI M/M Jun C -0.20% | P 0.00%Â Â Â Â Â Â Â Â Â Â Â Â Â Â
07:15Â Â Â Â CHFÂ Â Â Â Â Â Â CPI Y/Y Jun C -1.00% | P -1.00%Â
08:30Â Â Â Â GBPÂ Â Â Â Â Â PPI Input M/M Jun C -2.10% | P -2.50%Â
08:30Â Â Â Â GBPÂ Â Â Â Â Â PPI Input Y/Y Jun C -2.20% | P 0.10%Â Â Â Â Â Â
08:30Â Â Â Â GBPÂ Â Â Â Â Â PPI Output M/M Jun C -0.20% | P -0.20%Â Â Â Â Â Â Â Â Â Â Â Â Â
08:30Â Â Â Â GBPÂ Â Â Â Â Â PPI Output Y/Y Jun C 2.40% | P 2.80%Â Â Â Â
08:30Â Â Â Â GBPÂ Â Â Â Â Â PPI Output Core Y/Y Jun C 2.00% | P 2.10%Â Â Â Â Â Â Â Â Â Â
10:00Â Â Â Â EURÂ Â Â Â Â Â Â German Industrial Production M/M May C 0.10% | P -2.20%Â Â Â Â Â Â Â
12:30Â Â Â Â CADÂ Â Â Â Â Â Net Change in Employment Jun C 5.0K | P 7.7KÂ
12:30Â Â Â Â CADÂ Â Â Â Â Â Unemployment Rate Jun C 7.30% | P 7.30%Â Â Â Â Â Â Â Â
12:30Â Â Â Â CADÂ Â Â Â Â Â Building Permits M/M May C -1.00% | P -5.20%Â
12:30Â Â Â Â USDÂ Â Â Â Â Â Change in Non-farm Payrolls Jun C 90K | P 69KÂ Â
12:30Â Â Â Â USDÂ Â Â Â Â Â Unemployment Rate Jun C 8.20% | P 8.20%Â Â Â Â Â Â Â Â
14:00Â Â Â Â CADÂ Â Â Â Â Â Ivey PMI Jun C 57 | P 60.5Â Â Â Â Â Â Â Â Â Â Â
14:30Â Â Â Â USDÂ Â Â Â Â Â Natural Gas Storage P 57B
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Ranges as of 6am London time
                               Highs  Lows
USD/JPYÂ Â Â Â Â Â Â Â Â Â Â Â 80.021 | 79.853
EUR/USDÂ Â Â Â Â Â Â Â Â Â Â Â 1.2398 | 1.2375
EUR/JPYÂ Â Â Â Â Â Â Â Â Â Â Â 99.10 | 98.90
AUD/USDÂ Â Â Â Â Â Â Â Â Â Â Â 1.0288 | 1.0243
NZD/USDÂ Â Â Â Â Â Â Â Â Â Â Â 0.8047 | 0.8012
USD/CADÂ Â Â Â Â Â Â Â Â Â Â Â 1.0159 | 1.0141
EUR/CHFÂ Â Â Â Â Â Â Â Â Â Â Â 1.20139 | 1.20108
USD/CHFÂ Â Â Â Â Â Â Â Â Â Â Â 0.97079 | 0.96867
GBP/USDÂ Â Â Â Â Â Â Â Â Â Â 1.5534 | 1.5518
EUR/GBPÂ Â Â Â Â Â Â Â Â Â Â 0.79825 | 0.7974
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Good luck
Andy