Quieter day in Asia ahead of Nvidia results after the US close

General trend

- Japan Chip-relateds Advantest +1.6% and Tokyo Electron +1.3% ahead of Nvidia’s Q2 results in fairly quiet trading. Nikkei led Asia with just +0.2% gains while Australia's ASX 200 saw some volatile earnings results with Woolworths -12%, Wisetech -17% and Domino’s Pizza Enterprises -17% on missed profits, while TabCorp +31% and overall ASX +0.1%. Miners BHP +1%, Rio Tinto +1%, Mineral Resources +5%.

- Australia July CPI came in a lot hotter than expected (highest in a year). Largest contributors were Housing (+3.6 per cent), Food and non-alcoholic beverages (+3.0 per cent), and Alcohol and tobacco (+6.5 per cent). Annual growth in new dwelling prices remains low reflecting a subdued new home market.

- Not a big market reaction, with Aussie dollar briefly touching 65 handle, near the week’s highs as AU 3-year yields initially +3bps, but both AUD and yields pared gains somewhat later.

- Japan’s e-cash co Monex +12% upon plans to back a Yen-based stablecoin with Japan government bonds.

- A quieter day for the Japanese yield curve which was mostly flat after yesterday touching or exceeding multi-year / multi-decade highs. JP 30-year and 40-years +1-2bps. Today saw 2-3x coverage of successful vs competitive bids for the BOJ outright bond auction.

- China’s July Industrial Profits kept falling y/y, but at a reduced pace of decline.

- In a potentially worrying sign for China’s economic stability, China’s Sinolink Securities will reportedly raise funding margin deposit ratio for new client financing to 100% (from 80%). A reminder that back in November of the turbulent year 2015 for the China economy that China doubled its margin deposit requirements to 100%.

- Perhaps cognizant of the risks due to stagnant growth amid deflation, China said it would announce details of its expansion of services consumption policies in September. Shanghai +0.3% after the confirmation.

- Some doubt now on whether Japan Chief Trade Negotiator Akazawa will be visiting the US this week after all.

- China PBOC again set a stronger fix, near 7.11 vs USD, for its strongest since Nov 6th, 2024 with Offshore Yuan (CNH) nearing its July highs but failing to pierce.

- SpaceX’s Starship rocket finally succeeded in successfully launching and deploying satellites on its tenth flight, following a year of failures.

- US equity FUTs flat to slightly higher during Asian trading.

Looking ahead (Asian-weighted releases, using Asian time zone)

- Wed Aug 27th (Wed eve DE Sept GfK Consumer Confidence, Wed night Nvidia Q2 Results).

- Thu Aug 28th NZ Aug ANZ Business Confidence, KR BOK Rate Decision, PH BSP Rate Decision, (Thu eve US Q2 GDP 2nd Est).

- Fri Aug 29th JP July Retail Sales, JP July Industrial Prod, JP Aug Consumer Confidence, IN Q2 GDP (Fri night US July Core PCE).

Holidays in Asia this week

- Mon Aug 25th Philippines.

- Wed Aug 27th India.

Headlines/economic data

Australia/New Zealand

- ASX 200 opens +0.3% at 8,962.

- Australia July CPI Y/Y: 2.8% V 2.3%E (highest since Jul 2024).

- Australia Q2 Construction Work Done: 3.0% v 1.0%e.

- Australia July Westpac Leading Index M/M: +0.14% v -0.03% prior.

- Australia sells A$1.2B vs. A$1.2B indicated in 2.75% Jun 2035 bonds; Avg Yield: 4.3228% v 4.2953% prior; bid-to-cover: 3.51x v 3.30x prior.

- Follow Up: New Zealand Finance Min Willis: Plans to remove barriers for new supermarket entrants.

- RBNZ raised FX currency intervention capacity in Jul to NZ$26.3B v NZ$25.6B m/m.

China/Hong Kong

- Hang Seng opens +0.4% at 25,626; Shanghai Composite opens flat at 3,869- China July Industrial Profits Y/Y: -1.5% v -4.3% prior.

- Follow up: China MOFCOM Official Sheng Qiuping: China to announce expansion of services consumption policies in Sept - press.

- SinoLink Securities: Said to raise funding margin deposit ratio for new client financing to 100% from 80%, effective from Aug 27th- US financial press [update].

- China Commerce Min (MOFCOM) Wang Wentao: China wishes to expand its bilateral trade size with Saudi Arabia - financial press, citing meeting with Saudi Investment Minister.

- China Premier Li Qiang:To promote high quality development of service trade.

- China said to promote AI use; To boost intelligent car and robot development - press.

- Hong Kong July Trade Balance (HKD): -34.1B v -24.7Be.

- China PBOC sets Yuan reference rate: 7.1108 v 7.1188 prior (strongest since Nov 6th, 2024).

- China PBOC Open Market Operation (OMO): Injects CNY380B in 7-day reverse repos; Net drains CNY236B v drains CNY175B prior.

Japan

- Nikkei 225 opens flat at 42,203.

- Korea Investment and Securities to invest in superlong JGBs - financial press.

- Follow Up: Japan Trade Negotiator Akazawa to visit the US from Thurs. to discuss Japan investments in the US - Japan media.

- Japan to penalize Mitsubishi Corp for exit from Wind Power projects - Nikkei.

- Monex Group considering issuing yen-pegged stablecoin in Japan; To back yen stablecoin with Japanese government bonds - financial press.

- Japan Industry Ministry reportedly considers 5-year corporate tax scheme from FY26 to boost domestic investment - Japan press.

- SEAJ: Japan July Chip-Making Equipment Billings Y/Y: +18.1% v +17.6% prior.

Korea

- Kospi opens +0.2% at 3,185.

- South Korea July Retail Sales Y/Y: 9.1% v 7.3% prior.

- South Korea Aug Manufacturing Business Survey: 93.3 v 91.9 prior.

- Pres Lee: South Korean shipbuilders are too invest and hire in the US - comments at Hanwha Philadelphia shipyard.

- South Korea said to consider selling USD-denominated bonds - US financial press.

Other Asia

- Thailand MOF: Now sees 2025 GDP higher than 2.2% forecast; Strong H1 GDP growth to support FY25 growth - financial press.

- Thailand Central Bank (BOT) Edited Minutes of the Monetary Policy Committee Meetings: there were no indications of a broad-based decline in the prices of goods and services.

- Taiwan July Industrial Production Y/Y: 18.1% v 17.0%e.

- Indonesia Chief Tariff Negotiator Hartarto: US has agreed in principle to exempt Indonesian exports of cocoa, palm oil and rubber from Pres Trump's tariff of 19% imposed since August 7th.

North America

- Pres Trump to chair "large" meeting on Gaza post-war plan, Wed ET - US Envoy Witkoff comments.

- (US) Redfin: The gap between 10-year treasury yields and mortgage rates (known as the mortgage spread) has dropped to its lowest level in over three years, allowing mortgage rates to fall more than treasury yields, signaling a potential boost for homebuyers.

- (US) Commerce Sec Lutnick: If the US government is adding fundamental value to your business it’s fair for Pres Trump to ask for something in return; Having big discussions around defense companies; We are not starting a sovereign wealth fund - CNBC.

- (US) July preliminary Durable Goods Orders: -2.8% V -3.8%E; durables (ex transportation): 1.1% V 0.2%E; Capital Goods Orders (non-defense/ex-aircraft): 1.1% v 0.2%e.

- (US) Aug Philadelphia Fed Non-Manufacturing Activity: -17.5 v -10.3 prior; Prices Paid: 43.2 v 32.5 prior; New Orders: 21.5 v 9.7 prior.

- (US) Trump admin reportedly threatens to withhold funding from three states for failing to require truck drivers speak English – press.

- (US) Aug consumer confidence: 97.4 V 96.5E.

- (US) Aug Richmond Fed Manufacturing index: -7 V -11E; Volume of new orders: -6 v -25 prior.

- (US) US Pres Trump: Furniture tariff will be done very quickly and reiterates that this tariff will be 'very substantial'.

- (US) Treasury $69B 2-year note auction draws 3.641% V 3.820% prior; bid-to-cover ratio: 2.69 V 2.62 prior and 2.64 over the last 12 auctions.

- (CA) Bank of Canada (BOC) Gov Macklem: Not revisiting 2% inflation target.

- (US) US Treasury Sec Bessent: Fed independence comes from a political arrangement.

- (US) President Trump: Prepared for a legal fight on US Fed's Cook, always have legal fights.

Europe

- (HU) Hungary central bank (MNB) leaves base rate unchanged at 6.50%; as expected.

- (UK) BOE's Mann (hawkish dissenter): Research shows increased persistence in inflation but also shows a weak growth outlook; Monetary policy not tight enough in BOE's Aug rate path- speech text.

Levels as of 01:20 ET

- Nikkei 225 +0.2%, ASX 200 +0.2%, Hang Seng -0.3%; Shanghai Composite +0.2%; Kospi flat.

- Equity S&P500 Futures +0.1%; Nasdaq100 +0.1%; DAX +0.1%; FTSE100 flat.

- EUR 1.1612-1.1651; JPY 147.28-147.98; AUD 0.6483-0.6505; NZD 0.5842-5864.

- Gold -0.2% at $3,425/oz; BTC +1.1% at $111,680; Crude Oil +0.1% at $63.30/bbl; Copper -0.6% at $4.5220/lb.