MALAYSIA: BNM Governor Sees Cut as Pre-Emptive, Looks Ahead to Forecast Revision
Jul-09 10:11
Following the rate cut earlier today (the first since COVID), an interview with BNM governor Dato’ Seri Abdul Rasheed Ghaffour published in Bernama. Key points:
- Inflation expected to remain moderate, amid contained global cost conditions and absence of excessive domestic demand
- OPR cut is not due to US tariff threat, with negotiations with the US progressing
- Employment and wage growth should stay supported via higher salary increments for civil servants and higher minimum wage
- Balance of risks remains tilted to downside, stemming from slower global trade, weaker sentiment and lower-than-expected commodity production. Reflecting this, a new GDP growth and inflation forecast for this year will be published in the fourth week of July - although the governor does not foresee a major revision to growth expectations, he does not repeat the same statement for CPI.
- Future decisions remain guided by assessment of growth and inflation, today's cut was pre-emptive. MPC not on a pre-set course.
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US TSY OPTIONS: TYQ5 113.00 Calls Lifted
Jun-09 10:10
TYQ5 113.00 calls paper paid 0-12 on 5K, representing another round of upside flow after the buying of the TYQ5 112.50 calls we flagged previously.
EUR: Some activity in the CME FX Roll
Jun-09 10:06
- Some early activity in the FX CME roll, nothing huge as of Yet, but the pace will pick up into Friday, should be all but done by then, Expiry is next Monday.
- The EURUSD trades mostly on legs, just bought for 0.00702 in 4.8k.
- The spread has traded in just 4.5k outright total, and the record high for this EURM5/U5 spread printed in May is at 0.00716.
EUROSTOXX50 TECHS: Price Signal Summary - EUROSTOXX50 Trend Needle Points North
Jun-09 10:05
- In the equity space, the trend condition in S&P E-Minis is unchanged, it remains bullish and the contract traded to a fresh cycle high last week. The recent break of 5993.50, the May 20 high and a bull trigger, highlights a resumption of the uptrend and maintains a price sequence of higher highs and higher lows. A continuation would open 6057.00 next, the Mar 3 high. Key support lies at 5789.75, the 50-day EMA.
- The trend cycle in EUROSTOXX 50 futures remains bullish and the contract is trading closer to its recent highs. Moving average studies are in a bull-mode position, highlighting a clear dominant uptrend. Sights are on 5516.00, the Mar 3 high and the key bull trigger. Clearance of this level would strengthen a bull theme. Key support to watch lies at 5280.33, the 50-day EMA. A clear break of this average would signal a possible reversal.
