Asian Session Forex Recap – Oct. 19, 2015

  • Chinese economy expanded by 6.9% y/y in Q3 2015 vs. 6.8% forecast
  • China’s industrial production up by 5.7% in Sept, lower than 6.0% consensus
  • Chinese retail sales up by 10.9% in Sept vs. 10.8% forecast
  • Chinese fixed asset investment up by 10.3% ytd/y vs. 10.8% consensus

The Chinese data dump came in fifty shades of red yet forex traders don’t seem to be dumping the higher-yielding currencies. AUD/USD is holding steady around the .7270 area (+0.11%), AUD/JPY is trying to hold on to the 87.00 handle (+0.03%), NZD/USD is cruising around .6800 (-0.10%), and NZD/JPY is keeping its head above 81.00 (-0.08%).

The latest GDP report indicated that the Chinese economy expanded by 6.9% in Q3 2015, its slowest pace of growth since early 2009. Industrial production was up only 5.7% year-over-year in September, lower than the projected 6.0% increase and the previous 6.1% gain. To top it all off, fixed asset investment slumped from 10.9% to 10.3% year-to-date compared to the same period last year, suggesting potentially weaker economic activity down the line.

The only positive data point was the retail sales report, which indicated an annualized 10.9% increase, just a notch up from the earlier 10.8% reading. If you’re scratching your head figuring out why riskier assets aren’t tumbling, try reading Forex Gump’s take on why the reports suggest that the Chinese slowdown ain’t so bad… yet.

The forex coast is clear when it comes to top-tier economic data from the European nations during today’s London trading session, but that doesn’t mean that the market is in for smooth-sailing seas ahead. Be on the lookout for any events that might affect overall risk sentiment or maybe a delayed reaction to the latest set of Chinese reports. Stay on your toes!

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U.S. Session Recap

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