Thursday, July 2, 2015

Daily FX Update, 2 July 2015

v  US employment and manufacturing data are stronger than markets expectation  
v  Malaysia headline PMI posts its weakest reading in 32 months 
v  Manufacturing sector in most Asian countries continue to deteriorate in June
v  Japan's Tankan Large Manufacturing Index hit its highest level since March 2014
v  Consumer prices in South Korea up 0.7% on year in May
v  Indonesia's consumer prices accelerate in June                         



OVERNIGHT MARKET UPDATE:

·         US ISM manufacturing index increased to 53.5 in June from 52.8. The details of the survey were solid with new orders and employment components rising to their highest level since December. Overall, it appears that manufacturing activity is showing tentative signs of stabilisation following the weakness earlier in the year. The ADP employment report rose 237,000 in June following the revised 203,000 (previous: 201,000) in May.
·         The Eurogroup held a conference call overnight to discuss Athens’ latest communication but there were few details from it. Chairman Dijsselbloem confirmed that there would be no further meetings until after the referendum. The ECB left Emergency Liquidity Assistance (ELA) unchanged at EUR89 billion and can review this provision and the haircuts applied to Greek collateral at any time.
·         UK June manufacturing PMI fell to 51.4 in June, the weakest print since April 2013 as production and new orders logged slower growth. 
·         Currency Market – USD found broad strength overnight as US data continued to make the case for September Fed ‘lift-off’.      
·         US Treasuries also sold off across the curve, with 10-year yields increasing 7 bps, as the latest developments regarding the Greek debt crisis led to some optimism about a potential deal.      
·         Global equity markets were positive, led by European bourses. While in US, the Dow Jones and S&P 500 were up 0.7%-0.8%.       
·         Oil prices fell sharply after the EIA data announcement. The US crude inventories was reported to rise by 2.4 million barrels last week, against market expectations for a decline. Iran is near a deal to ease oil sanctions after almost two years of talks.  
Gold prices slipped for a second straight session to end at a near four-week low on the upbeat ADP employment data for June.




INDICATIVE MAJOR CURRENCIES

Last Close
 8.05 am Snapshot
       Bid                   Offer
Expected Ranges for Today
        Low                       High
USD/MYR
3.7485
3.7510
3.7850
3.7490
3.7940
JPY/MYR (100)
3.0468
3.0370
3.0720
3.0300
3.0900
SGD/MYR
2.7726
2.7680
2.8030
2.7600
2.8200
EUR/MYR
4.1518
4.1430
4.1780
4.1200
4.2100
AUD/MYR
2.8721
2.8610
2.8960
2.8500
2.9200
GBP/MYR
5.8540
5.8610
5.8990
5.8300
5.9500
USD/JPY
123.03
123.15
123.56
122.75
123.75
EUR/USD
1.1076
1.0890
1.1200
1.0990
1.1100
AUD/USD
0.7662
0.7490
0.7800
0.7600
0.7700

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