Asia Summary and Highlights 24 Sep
Australian August monthly CPI +3%
Asia Session
The Australian August monthly CPI reached the top band of target range at 3% with trimmed mean 2.6%. Market participants seems to be reducing their anticipation of an imminent October cut but we believe trimmed mean CPI would carry more weight and persuade the RBA to cut by 25bps. AUD/USD is trading 0.28% higher at 0.6617, NZD/USD is trading 0.03% lower at 0.5857 while USD/CAD rises 0.07%.
Global equities are performing individually on Wednesday as there isn't much headline crossing the wire. Regional equities in China and Hong Kong are outperforming peers in the U.S. while Japanese equity indexes performing individually. USD/JPY is trading 0.19% higher at 147.92. Else, EUR/USD is trading 0.11% lower and GBP/USD down 0.13%.
North American session
Most eyes were on a speech from Fed’s Powell, who stated that with risks on both sides of the mandate there was no risk-free path for policy. There was little initial reaction but equities struggled. USD/JPY, which had previously recovered to 147.90 slipped back to near 147.50, while EUR/USD advanced to 1.1815 from 1.1790. The riskier currencies saw little movement, with USD/CAD slightly higher near 1.3850.
Ahead of Powell September’s S and P PMIs slipped, manufacturing to 52.0 from 53.0 and services to 53.9 from 54.5, but being far from weak generated little response. Fed’s Goolsbee and Bostic sounded cautious about easing but Bowman was dovish, warning the Fed was at risk of falling behind the curve.