Ranges (Up till 12.

10pm HKT)
Currency

Stronger All Ordinary and S&P E-Minis had the AudUsd

returning to 0.6960.

Currency

EURUSD

1.1154-1.1218

EURJPY

132.995-133.39

USDJPY

118.855-119.53

EURGBP

0.7301-30

GBPUSD

1.5270-1.5308

USDSGD

1.4261-96

USDCHF
AUDUSD

0.9701-62
0.6926-71

USDTHB
USDKRW

36.125-23
1200.4-1208.8

NZDUSD

0.6260-83

USDTWD

32.725-33.01

USDCAD

1.3290-1.3310

USDCNH

6.4615-6.4950

AUDNZD

1.1055-1.1101

XAU

1119.4-1122.1

Key Headlines
Safe haven currencies like Euro, Jpy and Chf bought in
the late morning but are they right? EurUsd soaked up
offers up to 1.1200; I heard better offers are at 1.1220
and stops through 1.1230.
Nikkei Index under pressure from start this knocked
UsdJpy off the days high and into 118-handle.

Crude oil futures continue to stay soft into Asia, but

UsdCad unchanged. We see offers from real money
accounts lined up from 1.3330 up to 60's. In rates space,
we think this UsdCad could back off to 1.3140-50.
Patrick Bennett noted that while China imports from
major partners contracted on year-on-year basis,
interesting note that imports from Canada are 7.5%
higher year to date.
Euro placed on the side lines for now. Slight risk off and
EurUsd challenged the sell orders above 1.1190, chewed
away bunch of offers up to 1.1200. I heard better offers
are at 1.1220 and stops through 1.1230. Bids are under
1.1125. Better buying below 1.1065. Market is totally
ignoring Athens but think closer to Sept 22, things will
change.

Asians

On NZ, Patrick Bennett said this CPI revision this

morning is still way below target of 1-3% on average over
medium term. This does not change the expectations of
RBNZ cut on Thursday.

China released its Aug trade data although surplus

widened, imports were a lot weaker suggesting softer
domestic activity. Shanghai Composite immediately
pared gains and slipped into red.

Patrick Bennett noted that while China imports from

major partners contracted on year-on-year basis,
interesting note that imports from Canada are 7.5%
higher year to date.

Usd/Asia started the session bid but lost ground into

midday.

FX Flows
Safe haven currencies like Euro, Jpy and Chf bought in
the late morning but are they right?
Japan Q2 GDP was revised this morning, contracted
0.3% as per original projection of 0.4% fall. UsdJpy
propped up as the Japanese walked in not surprising
as S&P E-minis up 0.7%. UsdJpy rally came to a halt
after 119.53, challenged by exporters. Nikkei turned
negative and this pressured UsdJpy into 119.20s. As
Nikkei continued to weaken, so did the UsdJpy. No real
bids seen at 119.00, paved way swiftly to 118.855. We
should see some real demand nearer to 118.50.
Statistics NZ revised Q2 CPI to 0.4% from previously
announced 0.3% on July 16. The agency said RBNZ has
been informed of this processing error. Our strategist
Patrick Bennett said this CPI is way below target of 1-3%
on average over medium term. This does not change the
expectations of RBNZ cut on Thursday. Nzd a touch firm
but most due to AudUsd.
AudUsd broke 0.6950 and took out stops. Traded to
0.6971 where fresh offers were encountered. Release of
China trade data sent Aud back down to 0.6935.

Liquidity for USDCNH isnt good; we traded bid initially

up to 6.4950 after the Yuan fix of 6.3639. A rumour that
some North Asian banks attempted to take out stops at
6.5000 and failed. USDCNH drifted to 6.4720, then a
fierce move to 6.4615 some said the earlier buyers
bailed out and ouch!
Reuters printed a headline that onshore UsdKrw backed
off from 1208.8 high and traders suspect it was BOK
intervention. Throughout the rest of the morning,
onshore UsdKrw traded softer.
UsdSgd backed off like other currency pairs however
some macro funds are looking to buy this on dips,
probably near 1.4200-25.

Who said what

Japanese PM Abe is re-elected as LDP leader
Statistics NZ: Q2 CPI rose 0.4% Y/Y
Statistics NZ: CPI change after processing error found
Statistics NZ: RBNZ has been notified of CPI revision
Moodys: Malaysian Ringgit depreciation has limited
overall impact, but weaker commodity prices will weigh
on corporate earnings
Moodys: Ringgit depreciation manageable for
sovereign

These information have been obtained or derived from sources believed to be reliable, but I make no representation or warranty as to their accuracy or completeness.
Copyright 2013 The Poon Report by Vincent Poon. All rights reserved.

 Moodys: Malaysian banks direct exposure to China is

limited
Moodys: Malaysia domestic asset quality maybe
pressure due to Malaysias exposure to China
Moodys: Lowers Asia growth forecast on slowing
exports, subdued domestic demand
Indonesia to become full OPEC member in Dec
NZ English: Treasury forecasts 2% GDP growth, less
than in budget
NZ English: May take some time for currency gains to
show through
NZ English: Lower Nzd will offset the impact dairy
prices
Moodys: Cuts Philippine 2015 growth to 5.7% from
6.7%
Moodys: Cuts Philippine 2016 growth to 6% from
6.5%

News & Data

Australia ANZ Roy Morgan Consumer Confidence at
106.7 from 113.3
Japan Jul BOP Current Account Balance improved to
+Jpy1.808trln from Jpy558.6bn
Japan Jul BOP Current Account Adjusted up
Jpy1.321trln from Jpy1.3trln
Japan Q2 Final GDP SA Q/Q fell 0.3% from -0.4%
Japan Q2 Final GDP Annualised SA Q/Q improved to
-1.2% from -1.6%
Japan Q2 Final GDP Nominal SA Q/Q rose 0.1% from
flat
Japan Q2 Final GDP Deflator Y/Y up 1.5% from +1.6%
Japan Q2 Final GDP Private Consumption Q/Q fell
0.7% from -0.8%
Japan Q2 Final GDP Business Spending Q/Q fell 0.9%
from -0.1%
Australia Aug NAB Business Conditions at 11 vs 6
Australia Aug NAB Business Confidence at 1 vs 4
China Aug Trade Surplus rose to $60.24bn from
$43.03bn
China Aug Exports Y/Y fell 5.5% from -8.3%
China Aug Imports Y/Y fell 13.8% from -8.1%
Ian Bremmer in Nikkei: Fears about Chinese
economy exaggerated, but reforms needed for
long-term stability
Fears for the stability of China's economy are
exaggerated. On the one hand, it's natural to fear the
global impact of any faster-than-expected slowdown
there. China is now the world's lead trading nation and a
major driver of commodity prices. European and
American stock markets now rise and fall on its latest
manufacturing data. Economies as diverse as Japan,
Chile, Australia, Thailand, South Africa, South Korea,
Brazil, Malaysia, Nigeria, Argentina, Russia and dozens
more feel the pain as economic activity in China slows.

http://asia.nikkei.com/Viewpoints/Perspectives/Fearsabout-Chinese-economy-exaggerated-but-reformsneeded-for-long-term-stability
WSJ: South Korea Fiscal Deficit Seen at SevenYear High in 2016
South Koreas fiscal deficit will widen to a seven-year
high in 2016, as the government plans to spend more to
shield the economy from a slowdown in China. The
budget plan, announced Tuesday by the Ministry of
Strategy and Finance, shows the governments total
spending for 2016 will increase by 3.0% to 386.7 trillion
won, 11.3 trillion won more than this years budget. The
ministry expects total income to increase by 2.4% to
391.5 trillion won next year. This will widen the fiscal
deficit to 37 trillion won, representing 2.3% of gross
domestic product next year and making it the worst
shortfall since 2009.
http://www.wsj.com/articles/south-korea-fiscal-deficitseen-at-seven-year-high-in-2016-1441679795?
mod=wsj_nview_latest
Jon Hilsenrath in WSJ: San Francisco Feds
Williams Sees Rate Increase This Year If Risks
Dissipate
For much of 2015, John Williams, president of the
Federal Reserve Bank of San Francisco, has projected a
rosy U.S. economic outlook, seeing solid output growth,
steady unemployment declines and an approaching need
to raise short-term interest rates. Williams, in an
interview with The Wall Street Journal on Friday,
wouldnt say whether rate increases at the Feds Sept. 1617 meeting are now in order. Instead, he sounded like a
man very much on the fence, reflecting the broader
internal debate within the central bank.
http://www.wsj.com/articles/san-francisco-fedswilliams-sees-rate-increase-this-year-if-risks-dissipate1441658566?mod=wsj_nview_latest
Nikkei: Mitsui Sumitomo Insurance in talks to
buy UK's Amlin
Japan's Mitsui Sumitomo Insurance is in the final stages
of negotiations to acquire British nonlife insurer Amlin
in a bid to speed up overseas expansion in response to a
shrinking domestic market. With an acquisition
premium likely to be tacked on to Amlin's share price,
the purchase will probably cost more than 500 billion
yen ($4.16 billion) -- a record for Mitsui Sumitomo, a
unit of MS&AD Insurance Group Holdings. The deal is
expected to be funded mainly through cash on hand with
bank loans making up the difference.
http://asia.nikkei.com/Japan-Update/MitsuiSumitomo-Insurance-in-talks-to-buy-UK-s-Amlin
The Australian - ChAFTA: Tony Abbott moves to
force early Labor vote

These information have been obtained or derived from sources believed to be reliable, but I make no representation or warranty as to their accuracy or completeness.
Copyright 2013 The Poon Report by Vincent Poon. All rights reserved.

The Prime Minister Tony Abbott will today move a

motion in parliament, seconded by Trade Minister
Andrew Robb which records the enormous economic
potential of the China-Australia Free Trade Agreement
(ChAFTA) to deliver jobs, growth and investment. The
motion calls on parliament to acknowledge that for
benefits to flow to Australian businesses and workers
without delay, it must be passed by parliament this year.
http://www.theaustralian.com.au/nationalaffairs/chafta-tony-abbott-moves-to-force-early-laborvote/story-fn59niix-1227517199771
FT: Five flashpoints in Singapores general
election
Singaporeans head to the polls on Friday in what some
observers have suggested is the city-states most
important election since independence. Opposition
parties are fielding candidates in all of the countrys 29
electoral divisions the first time the Peoples Action
party has faced such a challenge in its half-century of
unbroken rule over the tiny Southeast Asian nation.
http://www.ft.com/intl/cms/s/0/0c2c3a32-52b3-11e58642-453585f2cfcd.html#axzz3kzDg6LaT
Telegraph: I wasn't taken into custody, I was
meditating, says Man Group's China chief
The China head of hedge fund manager Man Group has
denied she was taken into custody by Chinese
authorities, saying media reports that said she had been
assisting a police investigation into market volatility
were false. Bloomberg reported last week that Li Yifei
had been taken into custody to help with inquiries,
sending shares in Man Group lower and unnerving
China's foreign investment community.
http://www.telegraph.co.uk/finance/chinabusiness/11850053/I-wasnt-taken-into-custody-I-wasmeditating-says-Man-Groups-China-chief.html
WSJ: Global Recovery Faces Hurdles as
Economic Overhauls Stall
From Turkey to Brazil, governments across the globe
have failed to follow through on promised economic
overhauls needed to spur growth and improve investor
confidence. Many are now trying to escape recession
while fighting a host of economic headwinds, including
deceleration in China, that could push the global
economy deeper into a slow-growth rut. Growth is too
low, productivity is too low, trade numbers are too low,
investment is too low, infrastructure projects are too few,
and the only thing that is too high is unemployment,
International Monetary Fund Managing Director
Christine Lagarde said here over the weekend, after two
days of talks among the worlds top finance officials.
http://www.wsj.com/articles/global-recovery-faceshurdles-as-economic-overhauls-stall-1441658661?
mod=wsj_nview_latest
These information have been obtained or derived from sources believed to be reliable, but I make no representation or warranty as to their accuracy or completeness.
Copyright 2013 The Poon Report by Vincent Poon. All rights reserved.