Daily FX Update, 05 May 2016

v  US ADP reports private-sector job gains slowed in April v  US ISM Non-manufacturing PMI growth continues at a faster pace v  US trade deficit shrinks as goods imports hit five-year low v  Final reading of Eurozone composite PMI is in line with the flash estimate v  Malaysia Government not revising growth and deficit targets despite stable oil prices

OVERNIGHT MARKET UPDATE: ·         US – The April ADP report came in below market expectations, added 156,000 jobs in the private sector. Market players expected the number to come in at 195,000. April’s reading also the weakest print in three years.  ·         US – The ISM non-manufacturing index rose to 55.7 in April, faster than the 54.5 recorded in March and the 54.8 expected by market players. The sub-index on employment rose to 59.9 vs 56.7, new orders reached their highest reading in six months, and prices paid rose to 53.4 vs 49.1. ·         US – The trade deficit narrowed to US$40.4 billion in March as imports of goods tumbled to their lowest level since 2010, a potential boost to first-quarter GDP estimates that also hints at sluggish domestic demand. ·         US – March factory goods orders rose 1.1% m/m and the final read for durable goods were unchanged at +0.8% m/m in March.  ·         Euro area – The composite final PMI for April was unchanged at 53.0, and remains close to its average this year (53.2). New orders rose to 53.1, the employment sub-index increased to 51.8, and the input price index rose to 50.7. ·         Currencies – The US dollar shrugged off numbers of mixed economic reports, including a weaker-than-expected ADP number, and rose for a second day against its main rivals. ·         Equities – Global equities continued risk-off. The Euro Stoxx fell 1.2%, with all the major sectors in the red. US equities fared marginally better, down 0.6-0.8%. ·         Rates – Sovereign yields were little changed. US 10-year yields were a touch lower at 1.78%, while German 10-year yields held steady at 0.20%.  ·         Energy – Crude oil prices closed modestly higher despite supplies grow as a wildfire in the oil sands regions of Canada is forcing many producers to cut output. EIA data showed US crude oil inventories rose 2.78 million barrels to 543.4 million barrels. ·         Precious Metals – A slightly stronger USD saw gold edge lower, although investor interest remains strong.

INDICATIVE MAJOR CURRENCIES Last Close 8.02 am Snapshot Expected Range for Today Bid Offer Low High USD/MYR 3.9932 4.0020 4.0350 4.0000 4.0450 JPY/MYR 3.7292 3.7410 3.7750 3.7300 3.8000 SGD/MYR 2.9394 2.9420 2.9760 2.9400 3.0000 EUR/MYR 4.5910 4.6000 4.6350 4.5800 4.6700 AUD/MYR 2.9781 2.9820 3.0160 2.9700 3.0400 GBP/MYR 5.7865 5.8110 5.8470 5.7800 5.9000 USD/JPY 107.08 106.72 107.14 106.32 107.32 EUR/USD 1.1497 1.1340 1.1650 1.1440 1.1550 AUD/USD 0.7458 0.7310 0.7620 0.7420 0.7520 Source: Bloomberg, AmBank