A pretty busy day for Asian session market players, who took cues from its U.S. counterparts and priced in a risk-averse trading environment.
- New Zealand’s trade deficit widens from 1.47B NZD to 1.56B NZD in September
- Japan’s service producer price index (y/y) gains 1.2% as expected vs. 1.3% uptick in August
New Zealand’s trade balance report
Earlier today New Zealand posted a trade deficit of 1,560 million NZD for the month of September, which marks a RECORD HIGH trade deficit for the economy after clocking in a 1,165 million NZD shortfall in August.
A closer look tells us that exports shot up by 14.1% from a year ago, as fruits, meat and edible offal, oil, iron and steel, and logs, wood, and wood articles saw increases.
Unfortunately, it wasn’t enough to offset the 18.8% annualized jump in imports. Turns out, inbound shipments were higher for oil (+86.6%!), aircrafts and parts, and fertilizers.
The trade deficit was NOT a welcome news to investors who are already worried that demand for New Zealand’s export economy will take even more hits as the U.S.-China trade war grinds on.
Market risk aversion
The bloodbath in U.S. equities rippled through to Asia, as concerns like the U.S.-China trade war, uncertainty of U.S. mid-term elections, Italy’s debt drama, Brexit, and China’s government failing to cheer its domestic markets with stimulus plans are putting global companies in a corner.
- Nikkei is down by 3.23% to 21,378.3
- A SX 200 is down by 0.34% to 5,683.9
- Shanghai index is down by 1.42% to 2,566.206
- Hang Seng is down by 1.80% to 24,794.6
Commodity prices were a little more mixed, with safe-haven gold taking advantage of the risk-averse trading vibe. Oil prices also saw heavy losses at the start of the session, but eventually recovered some a few hours later.
- Gold is up by 0.29% to $1,237.20 per troy ounce
- Brent crude oil is up by 0.01% to $75.65 per barrel
- U.S. WTI is down by 0.17% to $66.26 per barrel
Major Market Mover(s):
There were no direct catalysts to push the Aussie higher, but it’s possible that the comdoll won by default when a lot of its major counterparts priced in their respective domestic uncertainties.
AUD/USD is up by 21 pips (+0.29%) to .7080; AUD/JPY is up by 10 pips (+0.13%) to 79.35; AUD/CHF is up by 10 pips (+0.15%) to .7055; EUR/AUD is down by 21 pips (-0.13%) to 1.6113, and GBP/AUD is down by 35 pips (-0.19%) to 1.8202.
New Zealand’s record high trade deficit brought the bears to the Kiwi’s yard and dragged the comdoll lower against most of its major counterparts.
NZD/JPY is down by 10 pips (-0.13%) to 73.01; AUD/NZD is up by 41 pips (+0.38%) to 1.0854; EUR/NZD is up by 41 pips (+0.24%) to 1.7490; GBP/NZD is up by 30 pips (+0.15%) to 1.9756, and NZD/CHF is down by 6 pips (-0.09%) to .6499.
Forex bulls continued to stay away from the dollar today, as sharp declines in the U.S. equities markets lessened the demand for the Greenback.
USD/JPY is down by 17 pips (-0.15%) to 112.07; USD/CHF is down by 13 pips (-0.13%) to .9964; EUR/USD is up by 18 pips (+0.15%) to 1.1409; GBP/USD is up by 8 pips (+0.06%) to 1.2888, and USD/CAD is down by 35 pips (-0.27%) to 1.3021.
Loonie bulls kept their momentum from the previous session and continued to party over the BOC’s latest rate hike and not-so-dovish statements from central bank head honchos.
CAD/JPY is up by 10 pips (+0.12%) to 86.07; CAD/CHF is up by 10 pips (+0.13%) to .7652; EUR/CAD is down by 18 pips (-0.12%) to 1.4855, and GBP/CAD is down by 36 pips (-0.22%) to 1.6780.
Watch Out For:
- 7:00 am GMT: Spain’s unemployment rate expected to dip from 15.3% to 14.9%
- 8:00 am GMT: Germany’s Ifo business climate (103.1 expected, 103.7 previous)
- 11:45 am GMT: ECB’s interest rate decision due today. Read Forex Gump’s trading guide if you’re planning on trading it!