HALISTER1: USD/JPY Could Drop at Least 3% If BOJ Doesn’t Ease: Citi Survey

USD/JPY Could Drop at Least 3% If BOJ Doesn’t Ease: Citi Survey

(Bloomberg) -- USD/JPY to drop more than 3% if BOJ leaves policy unchanged and fails to provide forward guidance of easing after its meeting next week, according to 80% of respondents in a Citigroup global FX survey.
  • If the BOJ doesn’t ease but gives “concrete guidance” for a move in Sept., USD/JPY may drop 1%-2%, according to 34% of the 170 respondents; another 15% see pair falling by more than 2% in this scenario
  • 50% say USD/JPY would rise on forward guidance but no action
  • The survey outcome “may tempt BOJ to delay, make promises, and decide in September whether to move or not,” Citigroup head of G-10 FX strategy Steven Englander writes in note received July 19
    • “The modest USD/JPY (and presumably equity market) consequences from dangling a six-week carrot in front of market may be hard to resist if no action is intended,” he says
  • BOJ meets on July 28-29
  • USD/JPY down 0.2% to 105.92
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Steven Englander (Citigroup Inc)

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HALISTER1: USD/IDR May Breach 13,000 Level Even if BI Cuts Rate: Analysis

USD/IDR May Breach 13,000 Level Even if BI Cuts Rate: Analysis

(Bloomberg) -- USD/IDR may breach psychological 13,000 level in short-term, even if Bank Indonesia lowers policy rate this week, as rupiah stands to gain from tax amnesty inflows and ongoing demand for Indonesia’s high-yielding bonds, Bloomberg strategist David Finnerty writes.
  • Global funds have increased holdings of Indonesian bonds by $6.9b this year
    • Since Brexit vote on June 23, 9.8t rupiah ($748.1m) were purchased by foreigners, spurred by high yield and stable rupiah
    • Ongoing bond purchases by foreigners and tax amnesty funds flowing back should support IDR strength
  • USD/IDR’s MACD remains bearish with reading below zero and signal line; USD/IDR currently +0.1% at 13,101
  • Bank Indonesia will cut reference rate by 25bps, according to 16 out of 25 economists in a Bloomberg survey
    • 9 forecast the central bank to leave rate unchanged at 6.50%; decision due July 21
  • Deputy Gov. Perry Warjiyo said last month there’s room for monetary easing
    • Reduced expectations of a Fed hike this year, following U.S. May payroll data in June and Brexit, provide window for further easing
  • June CPI was 3.45% y/y, well within BI’s target corridor of 3%-5% for 2016
  • NOTE: Bank Indonesia will be switching from reference rate to reverse repo rate as the new its benchmark tool effective Aug. 19
  • NOTE: David Finnerty is an FX strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice.
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Perry Warjiyo (Bank Indonesia)

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HALISTER1: INSIDE SINGAPORE: USD/SGD Eyes 50-DMA, Momentum Turning Bullish

INSIDE SINGAPORE: USD/SGD Eyes 50-DMA, Momentum Turning Bullish

(Bloomberg) -- USD/SGD up 0.1% to 1.3549, showing bullish momentum on daily chart; if pair ends week above converging 50-and 100-DMA’s it may confirm a fresh upswing.
  • Click here for chart
  • 1-month implied volatility stabilizing around 6.0%
  • Malaysia, Singapore aim to start high-speed rail ops by 2026
  • SGX blames faulty disk for market trading halt last week
  • Rising momentum studies suggest SGD 5-yr interest-rate swaps may have formed near-term base ahead of CPI data due July 25; resistance near 21-DMA at 1.6728%, click here for chart
  • Yield on 10-yr govt bond fell 4 bps to 1.6747% yesterday, lowest daily close since July 11, based on data compiled by Bloomberg and central bank
  • 3-month interbank-offered rate unchanged at 0.87367% yesterday, matching lowest since July 2015
  • 6-month swap-offer rate little changed at 1.13780% on July 19
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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HALISTER: VW Sued by NY Over Pollution Linked to Cheat Device (Correct)

VW Sued by NY Over Pollution Linked to Cheat Device (Correct)

Alert: HALISTER
Source: BN (Bloomberg News)

Tickers
VOW GR (Volkswagen AG)
PAH3 GR (Porsche Automobil Holding SE)

People
Martin Winterkorn (Italdesign Giugiaro SpA)
Brian Frosh (State of Maryland)
Eric Schneiderman (State of New York Office of the Attorney General)
Jeannine Ginivan (Volkswagen Group of America Inc)
Maura Healey (Attorney General Of Ma)

Topics
BGOV Trans/Infrastructure
Civil Procedure

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UUID: 7947283