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On September 11, most short-term Shibor rates rose. The overnight Shibor rate fell 5.6 basis points to 1.369%, the 7-day Shibor rate rose 1.7 basis points to 1.466%, the 14-day Shibor rate rose 0.9 basis points to 1.51%, and the 1-month Shibor rate rose 0.2 basis points to 1.53%.Fitch: The financial position of gas operators in Asia Pacific remains strong.On September 11th, the State Council Information Office held a press conference this morning on the theme of "High-Quality Completion of the 14th Five-Year Plan," highlighting the achievements of health care during the 14th Five-Year Plan period. According to the report, from 2020 to 2024, the number of primary healthcare institutions will increase from 970,000 to 1.04 million, the number of healthcare personnel will increase from 4.34 million to 5.26 million, and the number of medical consultations will increase from 4.1 billion to 5.3 billion.On September 11th, UBS published a report stating that Pop Mart (09992.HK)s share price has fallen approximately 19% from its recent high. The bank attributes this primarily to three factors: profit-taking following its inclusion in the Hang Seng Index, weakening secondary market prices for some products, and a decline in global Google search trends. Its worth noting that the bank has observed similar trends before, but these developments havent altered its positive outlook on Pop Marts fundamentals. UBS believes that Pop Marts current share price correction is creating buying opportunities ahead of anticipated short-term catalysts, including the launch of new Halloween products and its 15th anniversary collection, as well as the crucial Christmas sales season. The bank reiterated its Buy rating on the stock with a target price of HK$432.On September 11th, South Korean President Lee Jae-myung stated that he saw no need to persist with a previously proposed plan to expand the scope of capital gains tax. At a press conference on Thursday, Lee mentioned that the formal proposal, presented at the end of July, would have lowered the capital gains tax threshold from 5 billion won (approximately $720,000) to 1 billion won, raising questions about the governments commitment to reviving the stock market. "Some seem to see this as a litmus test of whether we are truly committed to policies to revive the stock market," Lee said. "If thats the case, I dont think its necessary to persist to the end. I will submit this issue to the National Assembly for review." The original proposal had caused a sharp drop in South Korean stocks and faced strong opposition from retail investors. Following Lees remarks, the Kospi index rose as much as 0.9% during intraday trading on Thursday before retreating. The index had reached a record closing high the previous day, partly due to market expectations that the government would abandon the tax increase proposal.

AUD/USD and JPY Are in Focus as APAC Trading Begins Amid Fed Bets and BOJ Scrutiny

Drake Hampton

Apr 25, 2022 10:30

Asia-Pacific Outlook for Monday

The risk-averse Last week, the Australian Dollar fell sharply against the US Dollar as markets adjusted to growing hawkish shifts in Fed rate hike bets. As a result of these shifts, short-term Treasury yields increased as traders sold government bonds. Overnight index swaps are pricing in a 'front-loading' of tightening, with 50 basis point hikes favored as the base case scenario for the next four FOMC meetings.

 

Apart from the Fed and rate hike bets, the market will be watching Australia's first-quarter inflation data due Wednesday. According to a Bloomberg survey, analysts expect the consumer price index (CPI) to rise to 4.6 percent year over year. This would be an increase from 3.6 percent year on year in Q4. A stronger-than-expected print may rekindle some bullish energy in the Australian Dollar, as bets on an RBA rate hike may strengthen in response to the strong price data. As of Friday, cash rate futures indicated a low probability of a rate hike at the RBA's May meeting.

 

The Japanese Yen will also be under focus this week, as the Bank of Japan is scheduled to release its April policy decision on Thursday. Rate traders do not anticipate a change in the benchmark rate, although they do anticipate an update to the bank's inflation targets. USD/JPY increased for a seventh straight week, owing to the BOJ's vigorous bond buying aimed at limiting rates. Last week, USD/JPY one-week risk reversals went into negative territory, indicating that options traders may be favoring some short-term Yen gains.

 

Elsewhere, the March trade balance for New Zealand will be released, which may cause some volatility in the New Zealand Dollar. NZD/USD declined last week as a result of the general risk-off sentiment that drove the majority of APAC currencies lower against the USD. This is despite the fact that bets for an RBNZ rate hike have firmed. The Kiwi Dollar's fall was almost certainly also a result of lower metal prices, which have been weighed down by both a stronger US Dollar and weakening demand as China's crackdown continues. 

Technical Analysis of the AUD/USD

The march bottom is clearly in focus after AUD/USD plunged this week, slicing through its 50-, 100-, and 200-day Simple Moving Averages (SMA). If prices fall below 0.7162, this might spark bearish sentiment sufficiently to push prices near the critical 0.7000 level. Recently, both the MACD and RSI oscillators produced bearish signals, with a cross below their respective center lines. 

AUD/USD Daily Chart

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