Forex Today: Antipodeans hit by fresh trade woes; Draghi, US CPI eyed

Dhwani Mehta FXStreet

A sense of caution prevailed across the financial markets in Wednesday’s Asian trading, as markets remained wary amid the latest tough stance adopted by the White House on China. The US President Trump said on Tuesday that he had no interest in moving ahead unless Beijing agrees again to four or five "major points" that Trump, however, did not specify. As a result, the demand for the safe-havens was lifted at the expense of the risk/ higher-yielding assets.

Among the G10 currencies, the Antipodeans were dragged lower by weak fundamentals and softer risk tones. The Kiwi fell further below the 0.66 handle after New Zealand’s retail spending fell by 0.5% in May. The Aussie hit fresh weekly lows sub-0.6950 following the second consecutive fall in the consumer confidence gauge. Both the OZ currencies failed to benefit from the in-line with estimates Chinese inflation figures and record higher iron-ore prices. The Yen traded on the front foot alongside gold prices, keeping USD/JPY under pressure below the 100-day SMA at 108.65. The Loonie traded firmer just shy of the 1.33 handle amid a sell-off in oil prices.

Meanwhile, both the European currency pairs, EUR/USD and Cable traded modestly flat amid a broadly subdued US dollar and negative Treasury yields.

Main Topics in Asia

Boris Johnson faces Remainer plot to thwart no-deal Brexit – The UK Telegraph

US Pres. Trump’s “secret” agreement “leaked”, reveals a concession for Mexico

Trump: Mexican president is 'great'

China Securities Journal: China has room for further targeted RRR cuts

Chinese CPI/PPI arrives in line with expectations

BOK's Lee hints at rate cut amid heightened external uncertainties

Japan PM Abe: Will exchange opinions with Iran’s leaders to ease tensions

Asian stocks trade mixed as China reports inflation at 15-month high

Gold: Buyers dominate around $1333 amid Hong Kong Protests, China data

Indonesian consumer confidence improves slightly in May, Rupiah unfazed

USD/INR: Rupee volatility hits lowest since August 2018

One-month HKD HIBOR rises to 2.42%, highest since October 2008

Fitch affirms Hong Kong at ‘AA+’, outlook ‘Stable’

Key Focus Ahead

There is nothing much of note, in terms of the economic news, from the Euroland today, except for the Spanish Inflation numbers and French Q1 payrolls. Therefore, all eyes will be on the speech by the European Central Bank (ECB) President Draghi (due at 0815 GMT) and the eventual impact on the Euro, especially after the US President Trump noted on Tuesday that ‘the Euro and other currencies are devalued against the US dollar’. Further, markets will also focus on the UK Parliament, the leadership race and Brexit developments amid a data-empty UK docket. Also, of relevance will be the speech by the Reserve Bank of Australia (RBA) policymaker Ellis at 0900 GMT, as we head towards the Australian jobs data due on Thursday.

The NA session offers the much-awaited US Consumer Price Index (CPI) data for the month of May at 1230 GMT, with the annualized core figures likely to stay unchanged while the headline numbers are expected to soften slightly. Among other releases, the US Energy Information Administration (EIA) weekly crude stocks data will drop in at 1430 GMT. At 1500 GMT, ECB’s Coeure’s speech will also draw some attention. The US monthly Budget Statement will be published later on at 1800 GMT.

Traders will also remain at the mercy of any tweets from the Trump, concerning the US-China trade spat that could have a major impact on the risk sentiment.

EUR/USD: Focus on Draghi’s speech and US CPI

EUR/USD is consolidating above 1.13 ahead of Draghi’s speech and key US data releases. The gains in the spot, however, will likely be short-lived, if the US reports a better-than-expected consumer price inflation for May at 12:30 GMT today.

GBP/USD trades modestly flat as traders await US CPI amid UK’s political play

While British lawmakers’ run to become the next PM remains surrounded by long-standing Brexit worries, traders weigh lack of UK data ahead of the London open this Wednesday.

Why US inflation may badly disappoint and down the dollar – FXStreet Surprise Index

The next top-tier indicator is the consumer price index release for May due on Wednesday, June 12th. Core CPI is set to rise by 2.1% year on year – repeating last month's figure – while accelerating from 0.1% to 0.2% on a monthly basis.

Australia: Weak employment data to underscore risks of a July RBA rate cut - NAB

Analysts at National Australia Bank (NAB) offer their expectations on Thursday’s Australian labor market report and its implications for the Reserve Bank of Australia (RBA).

GMT	Event	Actual	Consensus	Previous
Tuesday, Jun 11
23:50	JPY Machinery Orders (YoY)	2.5%	-5.3%	-0.7%
23:50	JPY Machinery Orders (MoM)	5.2%	-0.8%	3.8%
23:50	JPY Domestic Corporate Goods Price Index (MoM)	-0.1%	0.0%	0.3%
23:50	JPY Domestic Corporate Goods Price Index (YoY)	0.7%	0.7%	1.2%
Wednesday, Jun 12
24h	RUB National Day
00:30	AUD Westpac Consumer Confidence	-0.6%		0.6%
01:30	CNY Consumer Price Index (MoM)	0.0%	0.0%	0.1%
01:30	CNY Producer Price Index (YoY)	0.6%	0.6%	0.9%
01:30	CNY Consumer Price Index (YoY)	2.7%	2.7%	2.5%
03:00	KRW Money Supply Growth	6.9%		6.5%
05:00	SGD Retail Sales (MoM)		0%	1%
05:00	SGD Retail Sales (YoY)		0.3%	-1.0%
05:30	EUR Nonfarm Payrolls (QoQ)		0.3%	0.3%
07:00	EUR HICP (YoY)		0.9%	0.9%
07:00	EUR HICP (MoM)		0.2%	0.2%
07:00	EUR Consumer Price Index (YoY)		0.8%	0.8%
07:00	EUR Consumer Price Index (MoM)		0.2%	0.2%
07:00	RON Consumer Price Index		3.9%	4.1%
08:15	EUR ECB's President Draghi speech
09:00	EUR ECB's De Guindos speech
09:00	AUD RBA's Ellis speech
11:00	USD MBA Mortgage Applications			1.5%
11:00	TRY CBRT Interest Rate Decision		24%	24%
11:00	ZAR Retail Sales (YoY)		1.2%	0.2%
12:00	BRL Retail Sales (MoM)		0.8%	0.3%
12:00	INR Cumulative Industrial Output			3.6%
12:00	INR Manufacturing Output			-0.4%
12:00	INR Industrial Output		0.9%	-0.1%
12:30	USD Consumer Price Index Core s.a			261.735
12:30	USD Consumer Price Index n.s.a (MoM)		255.820	255.548
12:30	USD Consumer Price Index (MoM)		0.1%	0.3%
12:30	USD Consumer Price Index ex Food & Energy (MoM)		0.2%	0.1%
12:30	USD Consumer Price Index (YoY)		1.9%	2.0%
12:30	USD Consumer Price Index ex Food & Energy (YoY)		2.1%	2.1%
14:15	EUR ECB's Cœuré speech
14:30	USD EIA Crude Oil Stocks Change		-0.472M	6.771M
n/a	TRY Treasury Cash Balance			-14.25B
15:00	EUR ECB's Cœuré speech
n/a	USD 30-Year Bond Auction			2.892%
17:00	USD 10-Year Note Auction			2.479%
18:00	USD Monthly Budget Statement		$-185.5B	$160.0B
23:01	GBP RICS Housing Price Balance		-21%	-23%
23:50	JPY BSI Large Manufacturing Conditions Index (QoQ)		4.5	-7.3
23:50	JPY Foreign Bond Investment			¥441.7B
23:50	JPY Foreign Investment in Japan Stocks			¥-285.9B
Thursday, Jun 13
24h	EUR Eurogroup Meeting
00:00	AUD Consumer Inflation Expectations			3.3%
00:30	AUD Participation Rate		65.8%	65.8%
01:30	AUD Unemployment Rate s.a.		5.1%	5.2%
01:30	AUD Employment Change s.a.		17.5K	28.4K
01:30	AUD Fulltime Employment			-6.3K
01:30	AUD Part-Time Employment			34.7K
n/a	CNY M2 Money Supply (YoY)		8.6%	8.5%
n/a	CNY New Loans		1,225B	1,020B
n/a	CNY FDI - Foreign Direct Investment (YTD) (YoY)			6.4%
02:30	SGD Unemployment rate		2.2%	2.2%
04:30	JPY Tertiary Industry Index (MoM)		0.4%	-0.4%
04:30	EUR Consumer Price Index n.s.a (YoY)			2.9%
04:30	CHF SNB Financial Stability Report
06:00	EUR Consumer Price Index (YoY)		1.4%	1.4%
06:00	EUR Harmonized Index of Consumer Prices (MoM)		0.3%	0.3%
06:00	EUR Consumer Price Index (MoM)		0.2%	0.2%
06:00	EUR Harmonized Index of Consumer Prices (YoY)		1.3%	1.3%
06:00	RON Industrial Production (MoM)			0.3%
06:30	CHF Producer and Import Prices (YoY)		-0.6%	-0.6%
06:30	CHF Producer and Import Prices (MoM)		0%	0%
07:30	CHF SNB Interest Rate Decision		-0.75%	-0.75%
07:30	CHF SNB Monetary Policy Assessment
08:00	CZK Current Account (MoM)			0.21B
08:00	CHF SNB Press Conference
09:00	EUR Industrial Production w.d.a. (YoY)		-0.5%	-0.6%
09:00	EUR Industrial Production s.a. (MoM)		-0.5%	-0.3%
10:00	EUR Consumer Price Index (MoM)			0.4%
10:00	EUR Consumer Price Index (YoY)			1.7%
10:00	EUR HICP (YoY)			1.7%
10:00	EUR HICP (MoM)			0.4%
11:30	INR Balance Payment $			$-4.3B
11:30	INR Current Account Balance $			$-16.9B
12:30	USD Initial Jobless Claims		217K	218K
12:30	USD Continuing Jobless Claims		1.680M	1.682M
12:30	USD Export Price Index (MoM)		-0.1%	0.2%
12:30	USD Import Price Index (YoY)		0.4%	-0.2%
12:30	USD Import Price Index (MoM)		-0.2%	0.2%
12:30	USD Export Price Index (YoY)		-0.5%	0.3%
12:30	CAD New Housing Price Index (YoY)			0.1%
12:30	CAD New Housing Price Index (MoM)		0%	0%
13:00	RUB Central Bank Reserves $			$495.2B
14:30	USD EIA Natural Gas Storage Change		95B	119B
15:30	USD 4-Week Bill Auction			2.29%
19:00	ARS Consumer Price Index (MoM)			3.2%
21:00	KRW Import Price Growth (YoY)		3.0%	4.8%
21:00	KRW Export Price Growth (YoY)		0.0%	-0.4%
22:30	NZD Business NZ PMI		54.4	53.0
22:45	NZD Food Price Index (MoM)		0.4%	-0.1%
Friday, Jun 14
02:00	CNY Retail Sales (YoY)		8.1%	7.2%
02:00	CNY Industrial Production (YoY)		5.5%	5.4%
02:00	CNY NBS Press Conference
02:00	CNY Fixed Asset Investment (YTD) (YoY)		6.1%	6.1%
04:30	JPY Industrial Production (YoY)			-1.1%
04:30	JPY Industrial Production (MoM)			0.6%
04:30	JPY Capacity Utilization			-0.4%
04:30	EUR Retail Sales (YoY)			1.1%
05:00	EUR Gross Domestic Product (YoY)			1.1%
05:00	EUR Current Account			€-0.5B
05:00	EUR Consumer Price Index (YoY)			1.5%
06:00	EUR Wholesale Price Index (YoY)			2.1%
06:00	EUR Wholesale Price Index (MoM)			0.6%
06:30	INR WPI Inflation		3.10%	3.07%
06:45	EUR Consumer Price Index (EU norm) (YoY)		1.1%	1.1%
06:45	EUR Consumer Price Index (EU norm) (MoM)		0.2%	0.2%
07:00	TRY Current Account Balance		$-0.980B	$-0.589B
07:00	EUR Headline Inflation (MoM)		0.3%	0.2%
07:00	EUR Core Inflation (MoM)		0.1%	0.2%
07:00	EUR Core Inflation (YoY)		2.0%	1.9%
07:00	EUR Headline Inflation (YoY)		2.6%	2.3%
07:30	SEK Consumer Price Index (MoM)		0.1%	0.7%
07:30	SEK Consumer Price Index (YoY)		2.0%	2.1%
08:00	EUR Industrial Sales s.a. (MoM)		0.9%	0.3%
08:00	EUR Industrial Orders s.a (MoM)		2.4%	2.2%
08:00	EUR Industrial Orders n.s.a (YoY)		-4.1%	-3.6%
08:00	EUR Industrial Sales n.s.a. (YoY)		-2.5%	1.3%
09:00	EUR Consumer Price Index (EU Norm) (MoM)		0.1%	0.1%
09:00	EUR Consumer Price Index (MoM)		0.1%	0.1%
09:00	EUR Consumer Price Index (EU Norm) (YoY)		0.9%	0.9%
09:00	EUR Consumer Price Index (YoY)		0.9%	0.9%
10:00	EUR Consumer Price Index (MoM)			0.1%
10:00	EUR Consumer Price Index (YoY)			0.5%
10:30	RUB Interest rate decision		7.50%	7.75%
11:30	INR FX Reserves, USD			$421.87B
12:00	PLN Current Account			€533M
12:30	USD Retail Sales ex Autos (MoM)		0.3%	0.1%
12:30	USD Retail Sales Control Group			0%
12:30	USD Retail Sales (MoM)		0.6%	-0.2%
13:15	USD Capacity Utilization		78.7%	77.9%
13:15	USD Industrial Production (MoM)		0.1%	-0.5%
14:00	USD Michigan Consumer Sentiment Index		98.1	100.0
14:00	USD Business Inventories		0.4%	0.0%
15:00	COP Retail Sales (YoY)		5.8%	5.3%
15:00	COP Industrial ouput (YoY)		3.7%	3.2%
17:00	USD Baker Hughes US Oil Rig Count			789
19:30	USD CFTC USD NC Net Positions			$89.9K
19:30	USD CFTC Gold NC Net Positions			$156.1K
19:30	USD CFTC Oil NC Net Positions			400.2K
19:30	GBP CFTC GBP NC Net Positions			£-47.8K
19:30	JPY CFTC JPY NC Net Positions			¥-44.4K
19:30	EUR CFTC EUR NC Net Positions			€-87.6K
19:30	AUD CFTC AUD NC Net Positions			$-63.3K

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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