HALISTER1: INSIDE ASIA: Currencies Mixed; Yuan Approaches Five-Year Low

INSIDE ASIA: Currencies Mixed; Yuan Approaches Five-Year Low

(Bloomberg) -- Asian currencies mixed with China’s yuan falling toward five-year low and Australia’s dollar rising for third day after better-than-expected 1Q GDP data; Japan delays sales tax increase by 2.5 yrs, PM Abe says.
  • China manufacturing PMI at 50.1 for May vs est. 50.0
    • PBOC fixes yuan at weakest since Feb. 2011 again, at 6.5889 per dollar
  • Japanese yen edges higher after 1Q capital spending beat est.; could result in revision to final GDP reading for quarter to +0.6% q/q from preliminary +0.4%, Norinchukin Research Institute chief economist Takeshi Minami says
  • Yuan fixing, China PMI readings mostly within expectations, while AUD continues to be fed positive data points, says OCBC Bank vice president of FX strategy Emmanuel Ng
    • Watch U.S. ISM data today and Fed commentary later this week for big dollar cues
  • Onshore yuan makes fresh five-month low after PBOC fixing, while offshore yuan weakest since Feb. 4 after breaking USD/CNH resistance level at 6.5918, Jan. 29 low
    • USD/CNH buying led by intraday investors after fixing, FX traders in North Asia say
    • Caixin May manufacturing PMI at 49.2, matching est.
  • Aussie highest in two weeks vs dollar after 1Q GDP strongest in four years
    • 1Q GDP +1.1% q/q vs est. +0.8%; +3.1% y/y vs est. +2.8%
    • AUD/USD gaps up through overnight high on momentum fund- buying following strong 1Q GDP data, Asia-based FX trader says
    • AUD/JPY may rally and test 50-DMA resistance, reducing likelihood of rate cut: Bloomberg strategist David Finnerty
    • GBP/AUD trades below 21-DMA for first time since April 22 after GDP; bearish momentum suggests further weakness: Bloomberg strategist Andrew Robinson
  • Korean won falls; May exports -6.0% y/y vs est. -0.4%; imports -9.3% y/y vs est. -9.7%
    • May CPI 0.8% y/y vs est. 0.9%, April 1.0%
    • BOK board member says there is a need to cut key rate in near term, according to minutes released yday
  • Japan’s 1Q capital spending +4.2% y/y vs est. +2.4% and +8.5% in 4Q; PM Abe expected to announce delay in increase to sales tax at press conference 6pm local time
    • Govt mulls extending mortgage tax relief, Kyodo reports
    • BOJ cuts buying of linkers per auction, lifts rate of auctions in June
  • Baht little changed; Thai CPI seen up 0.27% in May, highest since Nov. 2014, vs +0.07% in April
  • Rupiah falls to one-week low ahead of data forecast to show Indonesia’s May inflation rose 3.30% y/y; see preview here
    • Govt will submit draft of revised 2016 budget: Kontan, citing FM Brodjonegoro
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Emmanuel Ng (Oversea-Chinese Banking Corp Ltd)
Takeshi Minami (Norinchukin Research Inst)

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UUID: 7947283

HALISTER1: INSIDE INDONESIA: Rupiah Slips; Revised 2016 Budget Due Thursday

INSIDE INDONESIA: Rupiah Slips; Revised 2016 Budget Due Thursday

(Bloomberg) -- Rupiah falls for a third day ahead of May consumer price data release that will probably show the slowest gain since at least 2010.
  • CPI probably rose 3.30% y/y, slowing from 3.60% advance in April, median est. in Bloomberg survey shows. That would be the lowest reading on record from data going back to 2010; see preview here
    • Though food prices rose ahead of Ramadan, base effects are likely to see headline inflation moderate to 3.28% y/y, Maybank economists write in note received May 31
    • Core inflation is expected to increase due to rising gold jewelery prices, car prices, and housing rent but remain relatively unchanged at 3.37% y/y vs Apr: 3.41% y/y
  • Government will submit draft of revised 2016 budget to parliament’s plenary meeting, Kontan reports, citing FM Brodjonegoro
  • Inflows from Indonesia’s planned tax amnesty will help boost economic growth to as much as 5.4% this year, BI’s Agung said in an interview published yesterday
    • Local govts will be allowed to directly intervene in markets to manage rising food prices, BI’s Agung says
    • Bank Indonesia yesterday said it’s “unconvinced” that rupiah will hit 14,000/USD level, as US economy is not too solid
  • Global funds were net buyers of $27.8m in Indonesian equities yday: exchange data
  • Rupiah falls 0.1% to 13,665 per dollar
  • Yield on 8.375% govt bond due Sept. 2026 rose 16 bps last month to 7.879%
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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HALISTER1: China May Manufacuturing PMI Due in 5 Mins; Est. 50.0

China May Manufacuturing PMI Due in 5 Mins; Est. 50.0

(Bloomberg) -- China manufacturing and non-manufacturing PMIs are due in 5 mins. Caixin China PMI manufacturing will be released later at 9.45am local time.
  • China May manufacturing PMI est. 50 vs prev. 50.1
  • China May non-manufacturing PMI est. n/a; prev. 53.5
  • Caixin China PMI manufacturing est. 49.2 vs prev. 49.4
  • NOTE: China PMI May Strike Another Blow to Yuan Before Fed, Analysts Say
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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