AUD: Asia wrap - Pushes Higher In Asia
The AUD/USD has had a range of 0.6417 - 0.6452 in the Asia- Pac session, it is currently trading around 0.6445. The USD has come under pressure straight from the opening this morning and has remained heavy across the board all through our session. If you want to express a short in the AUD the crosses look a better way to do it.
- Bloomberg - “Australia’s hefty A$1.2b sale of December 2035 debt went off with decent demand metrics. That underscores that the concerns swirling around Japanese and US government bonds at the longer end don’t really resonate for the South Pacific economy given its cleaner fiscal fundamentals.”
- MNI - Expectations of sustained strong pricing at auctions proved accurate, with the latest round of ACGB Dec-35 supply seeing the weighted average yield print 0.55bp through prevailing mids (per Yieldbroker).
- The AUD/USD has seen a decent bounce today, price action against the USD is pretty impressive considering what was thrown at it yesterday. First target looks to be the highs just above 0.6500, a sustained break above here would signal the potential for a larger move higher.
- Expect buyers to be around on dips while the support in the AUD holds, a close back below 0.6300/50 is needed to negate the newly formed uptrend.
- Options : Closest significant option expiries for NY cut, based on DTCC data: 0.6380(AUD300m), Upcoming Strikes : 0.6375(AUD483.6m May 23), 0.6550(AUD480.3m May 23)
AUD/JPY - Today's range 92.56 - 92.90, it is trading currently around 92.65. Decent demand seen towards the 92.50 area where it holds again in our session. A sustained close back below 91.50/92.00 is needed to turn the focus back towards the lows again.
Fig 1: AUD/USD spot Daily Chart
Source: MNI - Market News/Bloomberg
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OIL: Crude Down As US Worries Impact Markets
After rising close to 5% last week, oil prices are lower today driven by a pullback in risk following pressure from US President Trump on the Fed to cut rates and worries regarding the impact of increased protectionism on energy demand. April trade and confidence data will be monitored closely for signs of any early impact. Crude remains well above initial support levels though. The USD is significantly weaker (BBDXY USD index -0.7%) as markets fear political interference in US monetary policy.
- WTI is down 1.5% to $63.69/bbl during holiday-impacted APAC trading today. It reached a low of $63.38 earlier and is now around 10% softer this month with the bearish theme remaining intact. Last week’s rally helped the oversold condition to unwind. Initial support is at $55.12 with resistance $64.49.
- Brent has sold off 1.6% to $66.87/bbl following a low of $66.61. Last week’s 4.8% rise is considered corrective with the trend direction down. Initial support is at $62.00 with resistance at $67.95.
- Talks appear to be progressing between the US and Iran on its nuclear programme, which if successful could result in increased oil exports. Iranian comments continue to support its right to enrich uranium though and the lack of an agreement may result in tighter sanctions, which if enforced would support oil prices.
- The US has suggested that a lasting ceasefire in the Ukraine would allow an easing of sanctions on Russia, which would also add to global oil supplies, but it seems that the Easter truce has not been respected.
- Later the Fed’s Goolsbee appears and the US March leading index is released. Europe remains closed.
FOREX: Risk Averse Currencies Around A Percent Stronger Vs US Dollar
Market concerns of political interference in US monetary policy and continued tariff uncertainty have weighed heavily on the US dollar during APAC trading today. The BBDXY USD index is down 0.7% to 1216.10, close to the intraday low, with all G10 currencies stronger against the greenback but especially risk-averse yen, Swiss franc and euro. Risk-sensitive AUD and CAD are underperforming.
- USDJPY is down 1.0% to 140.73, close to the intraday low of 140.62 and below support at 141.00 after breaching 141.62 on Friday, which opens 140.32, 17 September 2024 low.
- EURUSD is just off its high of 1.1529 but is still +1.0% to 1.1512, breaking above resistance at 1.1473 and 1.1495 opening up 1.1555.
- The Swiss franc is 1.0% stronger against the greenback with the pair at 0.8085, its lowest since 2011. EURCHF is little changed at 0.9308.
- GBPUSD is up 0.6% to 1.3377 thus EURGBP 0.4% higher at 0.8606 off the peak of 0.8619.
- AUDUSD has breached resistance at 0.6392 opening 0.6409. The pair is currently up 0.4% to 0.6404, close to the intraday high. However, Aussie is weaker against other major currencies with AUDJPY -0.6% to 90.13 after briefly falling below 90.00 to a low of 89.97. AUDEUR is down 0.6% to 0.5564 after a trough of 0.5555. AUDNZD is -0.4% to 1.0696, still above Friday’s low of 1.0684.
- Equities are mixed with both the S&P & Nasdaq e-minis down 0.9% and TAIEX -1.4% but the CSI 300 is up 0.2% and Straits Times +1.2%. Oil prices are down with WTI -1.8% to $63.53/bbl. Copper is down 0.7% but iron ore is higher at around $99/t.
- Later the Fed’s Goolsbee appears and the US March leading index is released. Japan’s March Tokyo condominium sales print today. Europe remains closed.
ASIA STOCKS: Outflows Continue to Challenge Asian Bourses
The ongoing theme of outflows dominate Asia markets again as any inflows are short lived.
- South Korea: Recorded outflows of -$88m as of 18th, bringing the 5-day total to -$1,001m. 2025 to date flows are -$12,479, m. The 5-day average is -$200m, the 20-day average is -$431m and the 100-day average of -$156m.
- Taiwan: Had outflows of -$552m as of 18th, with total outflows of -$2,292m over the past 5 days. YTD flows are negative at -$20,009. The 5-day average is -$458m, the 20-day average of -$240m and the 100-day average of -$233m.
- India: Had inflows of +$470m as of the 17th, with total outflows of -$72m over the past 5 days. YTD flows are negative -$15,486m. The 5-day average is -$14m, the 20-day average of +$17m and the 100-day average of -$142m.
- Indonesia: Had outflows of -$487m as of 17th, with total outflows of -$1,273m over the prior five days. YTD flows are negative -$3,440m. The 5-day average is -$255m, the 20-day average -$100m and the 100-day average -$47m
- Thailand: Recorded outflows of -$40m as of the 18th, outflows totaling -$33m over the past 5 days. YTD flows are negative at -$1,422m. The 5-day average is -$7m, the 20-day average of -$25m the 100-day average of -$19m.
- Malaysia: Recorded inflows of +$9m as of the 18th, totaling -$75m over the past 5 days. YTD flows are negative at -$2,853m. The 5-day average is -$15m, the 20-day average of -$50m the 100-day average of -$40m.
- Philippines: Saw inflows of +$0m as of 17th, with net inflows of +$5m over the past 5 days. YTD flows are negative at -$287m. The 5-day average is +$1m, the 20-day average of -$4m the 100-day average of -$5m.
