Asia Summary and Highlights 22 July
Joe Biden announced his decision to pull out from the presidential race and endorses Kamala Harris
A series of easing from PBoC
Asia Session
In early Asia, Joe Biden released a statement on X (Twitter), that he will be pulling out of the presidential race, instead focus on finishing the remaining term. He later endorses Kamala Harris to be the next presidential nominee for the Democratic Party. While it is widely speculated after his debate with Trump, it is official now and Kamala will very likely be the one racing against Trump after Joe's endorsement. The market reaction is rather muted as we only see a mild dip in U.S. Treasury Yields after the broadly lowering opening gap of USD were being closed in most major pairs. USD/JPY is trading 0.05% higher at 157.45.
The PBOC cut its 7-day reverse repo, 1 and 5 years loan prime rate by 10bps and announced it was lowering collateral requirements for medium term lending facility loans. It is aiming to support the sluggish economy but the Chinese equity market continue to dip for the day, suggesting it may not be sufficient to reinstate market confidence in another economic boom. The AUD/USD is dragged lower by 0.21% to 0.6671, so as NZD/USD to 0.5996 while USD/CAD rose 0.03%. Else, EUR/USD is up 0.06% and GBP/USD up 0.03% from Friday's close but both have erased most gains in the session.
North American session
Global IT outages and a lack of US data helped ensure there was little FX movement in North America, USD/JPY trading near 157.50 and EUR/USD near 1.0880. USD/CAD saw a rise to near 1.3750 after a weak Canadian retail sales report for May, down by 0.8% and by 1.3% ex autos, but even that move was partially corrected. Equities were softer and UST yields slightly higher, and the USD marginally stronger overall.