July 6, 2015 / 11:11 PM / 2 years ago

IFR Markets ForexWatch Asia Regional Daily Briefing

SYDNEY, July 7 (IFR) -

Monday Night Headlines * Merkel reiterates last offer from creditors was very generous * ECB maintains ELA for Greek banks, collateral for ELA tightened * Greek banking source says haircut on ELA security increased by about 10% on some collateral * ECB haircut for ELA will not impact banks’ everyday business due to gap b/w level of ELA & collateral * Greece’s Tsakalotos to be sworn in as finance minister * Greece to extend bank holiday for at least a few more days (Bankers) * French, German leaders urge Greece to offer quick proposals * Germany’s Gabriel - Greece needs to change position to stay in euro * WTI tumbles more than 7% * US Markit Comp Final PMI Jun 54.6, 54.6-prev * US ISM N-Mfg Empl Idx Jun 52.7, 55.3-prev * US ISM N-Mfg Price Pd Idx Jun 53, 55.9-prev Macro Themes in Play * FX market surprisingly sanguine after Greek vote; all action in stocks, bonds and commodities: EUR ends only modestly down, traders reluctant to place bets * Global macro mood shifting bearish as investors startled by China moves to prop up stock market; US rates break hard lower; CRB collapses, WTI Crude down 8%; soft wages, labor participation rate, Europe seen weighing on Fed * ECB further haircuts Greek collateral used for ELA; seen as turn of the screw to banks; debate now more political than economic; markets start looking for next victim; Italy, Portugal both down 4% * AUD, CAD, NZD at new lows for move on China, commodities; CHF, JPY bid on safe haven status Overnight Currency Summaries prepared by NY IFR/BUZZ team EUR/USD * Friday gap filled in Europe’s morning; slide ensues, near 1.1040 into NY open * Bear pressure applied early, 1.1000 tested but holds, USD & US yields soften * Pair above 1.1090 but Europe high untouched, risk sours on ECB headlines * ELA level maintained but haircut adj; seen as effectively reducing ELA * EUR/USD slips towards 1.1040 late in the day with little bounce seen * All eyes now on EZ leader’s meeting Tuesday that will discuss Greferendum USD/JPY * Decent US Services ISM allowed USD/JPY to retrace 61.8% of 123.75-1.70 * Offers held by that 122.96 Fibo & others at figure & pre Tenkan at 123.04 * Word fm Merkel that last creditor offer to Greece was very generous weighed * ECB increases haircuts, but kept ELA levels steady pre Tues’s EG meetings * Risk-off flows generally favoring JPY; EUR/JPY rebound hit heavy c136 offers * All eyes on Chinese stocks & Greek post-ref plan & creditors meeting GBP/USD * EUR/GBP rose from 0.7057 to 0.7121 after Greek FinMin Varoufakis resigned * ELA maintained at Jun 26 level; collateral from Bk of Greece adjusted * EUR/GBP ending NY session at 0.7080, Greek proposals exp’d Tuesday * GBP/USD rises off early Greek no-vote low by 1.5510, ends NY near 1.5600 * Mixed US data was shrugged off as Greek headlines were the focus * Greek turmoil may lead to dovish BOE/FED in near term, BOE meets Thursday USD/CHF * Speculation of SNB on the bid to stop the sell-off to 1.0356 overnight * CHF up initially on safe haven flows after Greek ‘no vote’ * CHF firmer in NorAm trade as Greek creditors not backing off on demands * EUR/CHF recovered to 1.0455 but is closer to 1.0400 toward NYSE close * USD/CHF rebound held below Cloud top that flattens out at 0.9467 on Tues * CH sight deposits rise only 1.3bln despite confirmed intervention last wk USD/CAD * O/N range 1.2551/2632, NorAm range 1.2613/64, closed 1.2650 (+21 pips in NY) * Brent crude -6.25%, WTI -7.6%, aluminum -1.7%, copper (Ju1) -3.5%, gold +0.5% * AUD/CAD closed +0.9%, 0.9485, CAD/JPY -0.75%, 96.73, EUR/CAD +0.05%, 1.3982 * DXY +0.18%; Choppy day, Greek headlines criss-crossing adding to volatility * WTI opened NY trading -5.1% at 54.20 & closed 52.50, NY high 54.73 * Canadian Ivey PMI beat expectations at 55.9 (f/c 55.5) but down from May 62.3 AUD/USD * Weight applied in Europe as commodities were heavy, near 0.7490 into NY open * Dip bought despite new lows for rebar and persistent drop in iron-ore * Greek impact limited & allowed risk rally, AUD/USD tests 0.7530/40 resistance * Lift runs out of gas; risk then sours in afternoon, pair sub-0.7500 late * RBA on tap in Asia, no cut f/c but likely to be dovish & jawbone AUD lower * Break of April low suggests new bear leg underway, mkt now eyes 0.7200/50 area NZD/USD * Steady ascent in early NY as pair lifts from 0.6680 support area * Lift driven by short covers and thoughts that Greek impact to be limited * NY rally sees Europe’s 0.6713 high matched, lift stalls as sellers 0.6715/25 * Risk-off sentiment takes hold in afternoon as Greek ELA haircuts adj by ECB * NZD/USD slips towards 0.6680/85 late in day LATAM * USD/MXN shrugs off early rise after Greek no vote hits risk broadly * Rises to all-time high at 15.86 before reversing to 15.74, 55/100-HMA at NY cl * USD/BRL remains weak; CB poll sees cont’d weak growth/rising inflation in 2015 * 2016 inflation f/c lower, growth steady at 0.5%, ends NY by session high 3.15 * USD/CLP off early NY high by 642.70, weak copper & Greek risk-off flows weigh ASIAN CURRENCY OUTLOOK USD/AXJ * USD/AXJ mostly a touch lower as offshore sanguine over Greek NO vote * Market seemingly prepared to give Greece a few days to submit new proposal * Crude oil the big mover - WTI down over 7.0% on Iran nuclear deal * Commodities generally crushed - iron ore -4%; copper -2.9%; CRB -3.0% * Gyrations in China stocks have the China bears growling USD/KRW traded an 1123.3-1128.6 range in Asia on Monday; last at 1126.5. The Kospi closed down 2.4%. USD/SGD traded a 1.3480-1.3525 range in Asia on Monday; last at 1.3495. The Straits Times closed down 0.3%. USD/MYR traded a 3.7980-3.8090 range in Asia on Monday; last at 3.8080. The KLSE index closed down 1.0%. USD/IDR traded a 13350-13360 range in Asia on Monday; last at 13350. The Jakarta Interbank Spot Dollar Rate (JISDOR) was set at 13353. The IDX Composite closed down 1.25%. USD/PHP traded a 45.10-15 range in Asia on Monday; last at 45.10. The PSE index closed down 1.06%. USD/THB traded a 33.74-86 range in Asia on Monday; last at 33.85. Thai Set closed down 1.1%. USD/TWD traded a 30.92-97 range in Asia on Monday; last at 30.95. The Taiex closed down 1.1%. USD/CNY was set in Asia on Monday at 6.1160 slightly lower than the previous 6.1160 fix. OTC USD/CNY traded a 6.2057-6.2095 range; last at 6.2092. OTC USD/CNH last at 6.2125; range 6.2055-6.2150. The 1-yr NDF was last quoted in Asia at 6.2520-6.2540. The Shanghai Composite closed up 2.4%. The property sub sector closed up 3.7%. ChiNext closed down 4.5%. USD/INR traded a 63.40-65 range in Asia on Monday; last at 63.40. The Sensex closed up 0.4%. Economic Data Releases (GMT) 07 Jul 23:50 JP Foreign Reserves 07 Jul 00:00 PH Forex Reserves 07 Jul 01:00 PH CPI 07 Jul 04:30 AU RBA Cash Rate 07 Jul 08:00 TW Trade Balance 07 Jul 08:00 TW Exports of Goods 07 Jul 08:00 TW Imports of Goods 07 Jul 08:30 HK FX Reserves 07 Jul 09:00 SG Foreign Reserves 07 Jul 09:00 MY Reserves Looking Ahead - Events, Other Releases (GMT) 04:30 AU RBA Cash Rate Jul f/c 2.00%, 2.00%-prev

OVERNIGHT TRADED RANGES--------------- INTRADAY RANGES -- Close 2100GMT NDFS OPEN HIGH LOW LAST CURRENCY HIGH LOW CLOSE IDR 13440 13450 13375 13380-13410 USD/JPY 122.93 121.70 122.57 INR 63.82 63.76 63.57 63.59-62 EUR/USD 1.1096 1.0969 1.1057 KRW 1127 1129.4 1125.5 1127-1128 EUR/JPY 136.06 133.70 135.52 MYR 3.8240 3.8400 3.8240 3.8360-80 GBP/USD 1.5627 1.5510 1.5605 PHP 45.22 45.22 45.19 45.18-21 USD/CAD 1.2664 1.2551 1.2651 TWD 30.93 30.925 30.89 30.91-92 AUD/USD 0.7533 0.7452 0.7499 CNY 1-mth 6.1270 6.1260 6.1255-65 NZD/USD 0.6713 0.6645 0.6687 CNY 6-mth No Trades 6.1755-75 USD/SGD 1.3525 1.3477 1.3485 CNY 1-yr Dealt 6.2510 6.2490-10 USD/THB 33.86 33.74 33.855 Equities Close Change %Change UST(Yields) Close Previous DJIA 17684 -46 -0.26 10-year 2.29% 2.39% S&P 500 2069 -8 -0.39 2-year 0.59% 0.63% NASDAQ 4992 -17 -0.34 30-year 3.085% 3.19% FTSE 6536 -50 -0.76 Spot Gold($) 1169.90 1167.80 DAX 10891 -167 -1.51 Nymex 52.67 55.52 Nikkei 20112 -428 -2.08 Brent 56.69 60.32

Reporting by Peter Whitley

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