April 18, 2016

Key overnight events:

  • OPEC and other oil producers failed to agree on an output cap in Doha after Saudi Arabia insisted an absent Iran join. Crude oil futures expiring in May, slumped as much as 6.8% to $37.61/bbl early this morning, the biggest intraday drop since 1st Feb.
  • A 7.3 quake hit southern Japan on Saturday, resulting in extended factory closures of car and electronic makers, and boosting odds of a sales-tax delay. Economic losses are estimated to reach US$66 billion, Bloomberg reported.
  • At the G-20 meeting last week US Treasury Secretary Jacob Lew commented that Japan needs to focus on domestic demand and said FX market remain “orderly” even as yen appreciates, a clear warning that the US does not view yen intervention as warranted.
  • US industrial production for March fell 0.6% month-on-month, maintaining February’s pace, and worse than the expected drop of 0.1%.
  • Rousseff’s presidency is hanging by a thread after Brazil’s lower house of Congress voted in favour of her impeachment. The result is not final until lower house speaker Cunha ratifies it.

 

USDSGD:

  • Spot 1.3570
  • Non-oil domestic exports in March slumped 15.6% year-on-year, the most since Feb 2013; a 12.3%-decline was expected after February’s relatively modest gain of 2.0% year-on-year. Electronic exports fell 9.1% over the same period, worse than the 1.5%-drop forecasted.
  • USDSGD resumed its second session of paring gains, after rising to 1.3668 last Thursday following MAS’ surprise easing policy stance. The currency pair declined close to Friday’s lows of 1.3561.

 

AUDUSD:

  • Spot 0.7672
  • Oil’s overnight slump resulted in AUDUSD gapping down this morning, reaching a low of 0.7593, although it has since recovered and is currently trading near intraday highs.
  • RBA Governor Stevens is due to speak in New York tomorrow, while minutes from the RBA’s April meeting will be released tomorrow morning.

 

USDCAD:

  • Spot 1.28952
  • USDCAD rose by as much as 1.3% to a high of 1.2985, following failed oil talks in Doha.
  • During the G-20 meeting in Washington, Governor Poloz said he is not concerned about recent weakness in the US dollar, citing normal behaviour of flexible exchange rates in helping the adjustment process. He also added that the current environment of depressed demand makes fiscal stimulus particularly effective.

 

USDCNH:

  • Spot 6.4909
  • The PBOC set its reference rate 0.2% higher at 6.4787; USDCNH remained largely unchanged, trading within the range of its past two sessions.
  • Both UBS and Deutsche Bank upgraded China’s 2016 GDP estimates by 0.4% to 6.6% and by 0.2% to 7.0%, respectively, according to notes from both banks released on 15th Apr.
  • China’s economy grew 1.1%, the slowest quarter-on-quarter expansion since 2011, the National Bureau of Statistics said on Saturday; an expansion of 1.5% was expected.

 

USDNOK:

  • Spot 8.2989
  • Norway’s March trade surplus narrowed to NOK 9.1 billion from NOK 9.5 billion. Exports in March dropped 0.4% month-on-month.
  • USDNOK rose 0.8% to a 1-week-high of 8.3196, following crude oil’s 6.8% tumble.

 

© Jachin Capital Pte Ltd

UEN: 201419754M

The contents of this document are for information only and is taken or compiled from sources that we, Jachin Capital Pte Ltd, believe to be reliable. To the maximum extent permitted by law, we do not make any representation or warranty (express or implied) that this information is accurate, timely or complete and it should not be relied upon as such. Opinions expressed are our current opinions as at the date of this document only and are subject to change without notice. We endeavour to update on a reasonable basis the information discussed but regulatory, compliance or other reasons may prevent us from doing so. The publication and distribution of this document is not and does not imply any form of endorsement of any person, entity, service or product described or appearing here. This is not and does not constitute or form an offer to buy or sell nor the solicitation of an offer to buy or sell any security or financial instrument nor to participate in any particular trading or investment strategy. We are not soliciting any action based on this document. The information, services and products described or appearing here are intended only for Accredited Investors (as currently defined in the Securities and Futures Act) and are not intended for nor targeted at the public in any specific jurisdiction. This information does not take into account the particular investment objectives, financial situations or needs of individual investors. Investors should seek independent financial, tax or legal advice or make independent investigations as considered necessary or appropriate before making an investment decision. Investments involve risk. Any past performance, projection, forecast or simulation of results is not necessarily indicative of the future or likely performance of any investment instrument.

Essential SSL