Asia Summary and Highlights 10 September
Australian September Westpac Consumer Confidence Index 84.6
Australian August business confidence -4
Japan PM contender Kato wants Japanese to have higher wages
Asia Session
The slate of Australian data is tilted towards the pessimistic side but neither points towards a fast break in inflation, thus the RBA is unlikely to change the current trajectory. Regional equities are performing individually with Chinese equities being the laggard, U.S. three major equity indexes are also in the red. AUD/USD shook off early weakness to trade 0.13% higher at 0.6670, NZD/USD is also 0.12% higher at 0.6154 while USD/CAD rose 0.03%.
The potential Japan PM candidate Kato calls for a bold stimulus package, including a prompt of higher wage. His remarks seems to be out of line with his view towards household income, not to mention the fiscal limit for the Japanese government. USD/JPY is trading close to unchanged with 3 pips high to 143.17 as U.S. Treasury Yields outperform JGB yields. Else, EUR/USD is up 0.05% and GBP/USD is up 0.03%.
North American session
The US non-farm payroll rose by a slightly weaker than expected 142k with a significant 86k in net negative revisions. However unemployment corrected lower to 4.2% from 4.3% and average hourly earnings were above consensus with a 0.4% increase. The USD initially dipped before rebounding and eventually finished mixed, with the riskier currencies underperforming.
USD/JPY slipped from above 143 to 142 on the data before rebounding to 144, eventually settling slightly below 142.50. EUR/USD was little changed, but finished marginally below 1.11 after being marginally above before the data. EUR was stronger versus the GBP and weaker versus the CHF.
Canadian employment saw a near consensus 22.1k increase but with full time work falling, unemployment rising to 6.6% from 6.4% and wage growth slower the detail was weak. USD/CAD picked up above 1.3550 from 1.35 though AUD/CAD ended weaker near .9050 after initially bouncing above .91 on the data.
Fed’s Williams and Waller both stated that easing was now appropriate. Williams gave no view on by how much, needing to look more at the data. Waller was quite dovish, seeing the balance of risk shifting towards employment and suggesting he was ready to ease aggressively should data weaken further, but appeared to favor moving by 25bps in September.