Key Points and Outlook for August 10
8/10 (Friday)
03:30 (TBD) Japan-U.S. trade talks
07:30 NZD Manufacturing PMI
08:50 JPY Japan GDP
10:30 AUDRBA Quarterly Monetary Policy Statement
15:00 NOKNorwegian CPI (Consumer Price Index)
16:30 SEKSweden CPI (Consumer Price Index)
17:30 GBPUK GDP (MoM) / Quarterly GDP (Preliminary)・ Trade Balance
21:30 USDUS CPI (Consumer Price Index)
21:30 CADEmployment Change / Unemployment Rate
22:00 GBP NIESR Monthly GDP Forecast
8/11 (Saturday)
02:00 USD Baker Hughes Rig Count
03:00 USD Monthly Budget Statement (Fiscal Balance)
※ denotes indicators planned for trading
Today is the weekend and the eleventh day of the month.
Also, with the holiday starting next week, please watch movements near the neutral rate, FIX, open, and close.
Today's Focus
Awaiting the results of the U.S.-Japan trade talks, dollar buys, yen buys, and Swiss franc buys.
Among them, dollar buying is slightly stronger.
The U.S. is largely pricing in four rate hikes this year.
CPI is a significant mover, but attention has decreased.
USD/JPY is moving in a narrow range around 111 yen,watch whether trade talks or CPI can break it outas a breakout material.
Among today's indicators, UK GDP is notable.GBPThis time the release contents have changed.
Previously,
GDP was released quarterly in order: flash estimate, revision, and final. Now,
in addition to quarterly GDP, a monthly GDP will also be released.
The monthly GDP seems to be calculated mainly for the services sector, which accounts for about 70-80% of the UK economy.
We will watch how the market reacts.
The pound has fallen to near a year-low levels.
The drop is due to political uncertainty and Brexit negotiation opacity, but a weak GDP release today would further push the pound lower.
GBP/USD Timeframe Chart
Another major mover is the Australian quarterly monetary policy statement.RBA has recently left rates unchanged for 22 meetings in a row.The next move is expected to be a rate hike, but rates are expected to stay high until around 2020.
Today's release concerns monetary policy, so large moves are likely.
Yesterday's Review
Yesterday, RBNZ held rates as expected.
For details, see the summary below.
RBNZ Holds Rates, NZD Falls Sharply
The Turkish lira continues to fall to new lows.
USD/JPY to 20 yen and into the 19 yen area against the Turkish lira.
USD/Turkish Lira briefly hit “5.500”.
Turkish delegation appears to have returned home after failed negotiations with the U.S.
Turkish Economy Minister announced a new economic model would be unveiled on the 10th.
What it contains and whether it is implementable will likely push the lira lower depending on content.
USD/TRY Timeframe Chart
Today’s Strategy and Current Positions
Yesterday's drop in crude prices and worsening relations with Saudi Arabia are considered negative factors,closing CAD/CHF long positions.
Canada's employment data is released today, so I will reassess after the results.
Currently held positionsEUR/USD short is heldI plan to add to the position if it breaks below 1.5000.
CPI in Norway and Sweden, UK GDP, and Canada employment may present opportunities for indicator trading if they arise.
Yesterday's Key Statements
RBNZ Statement
“Policy rates are expected to remain at considerably accommodative levels for a prolonged period.”
“Policy rates are projected to be held from 2019 to 2020.”
“Moves in rates could move in both directions.”
“If cost pressures rise, inflation expectations could be affected, and the pace of rate increases could be higher.”
“Over the past year the labor market has tightened, employment is near its maximum sustainable level, and unemployment is expected to decline gradually from current levels.”
“RBNZ's rate outlook risks are balanced in both directions.”
“NZD exchange rates are at lower levels and will support exports.”
“NZD is very close to its fair value.”
“Low inflation gives RBNZ room to keep rates low for a long time.”
“If growth slows below potential, there is a possibility of rate cuts.”
Deputy Governor of the Bank of New Zealand (RBNZ)
“The probability of a cut is rising.”
