Halister News

(Bloomberg) -- Asian currencies fall on broad risk-off in emerging market assets after a tracking poll overnight showed Trump leading in U.S. election race. Won’s losses worsened by political developments as South Korean President Park ousts ministers.

• Trump win would have bigger global impact than Brexit, Westpac strategists including Sean Callow wrote in note
  • AUD/USD may see a sharp fall if Trump prevails, along with slides in MXN, NZD, CAD, global equities and some Asian currencies
• Won under more pressure as S. Korea’s nominee Finance Minister Yim sees need for expansionary economic policies, raising speculation of more BOK easing, says Masakatsu Fukaya, an EM trader at Mizuho Bank
  • Won touches 1,152.20 per dollar, weakest since July 14
• Betting odds have risen for Trump to win the presidential election and markets are trading that as a risk-off move, Sue Trinh, head of Asia FX strategy at RBC Capital Markets says, adding that MXN is bearing the brunt of it
• Risk aversion is gaining traction led by a spike in USD/MXN as ex-Asia buy stops triggered, say traders
• MSCI Asia Pacific index falls as much as 1.4%, most since Sept. 12
  • Heavy equities attracting leverage selling of spot USD/JPY, while AUD/USD is weighed by macro flows versus JPY and NZD. traders say
  • Risk-off spurs gains in bond prices, with Australia 10- year yield dropping 4bps to 2.347%; yield in Korea falls 4bps to 1.692%
• USD/JPY falls as much as 0.5% to 103.63, a second day of decline as investors sought safe-haven assets
• BOJ Governor Kuroda says there’s no limit to amount, or ratio, of bonds central bank can buy; adds BOJ will adjust policy appropriately to keep momentum
  • BOJ will probably maintain status quo unless yen surges, former board member Sayuri Shirai says on Bloomberg TV
  • USD/JPY is having a deep downward correction after pair struggled to sustain breach above 105 levels, says Takuya Kanda, senior researcher at Gaitame.com Research Institute
  • AUD/JPY sold by hedge funds and banks, as Asian stock markets slide in early session: FX traders
• Won plunges as much as 1.1%, as concerns over developing scandal involving President Park’s friend weighed further
  • President Park nominated a new PM and FinMin as she seeks to stem fallout from an influence-peddling scandal
  • Recent developments add to the economic uncertainty, which may anchor short-term bond yields and weaken won, says Hong sup Shin, head of fixed income at Truston Asset Management
  • NAB recommends long USD/KRW 6-month forwards, more room for KRW weakness on risk of firmer USD and domestic headwinds, head of Asia research Christy Tan says
  • North Korea said to be prepping to launch ballistic missile in next 24-72 hours, Fox News says
• Kiwi jumps after better-than-expected 3Q N.Z. jobless rate
  • Labor data put off further RBNZ rate cuts; see research roundup
  • Kiwi surged through overnight high and option selling at 0.7200 on release of solid 3Q employment data: trader
  • Two-year ahead inflation expectations of businesses gain to 1.68% for the 4Q, from 1.65% prior, according to RBNZ survey
• Aussie falls vs kiwi after Australia September building approvals drop 8.7% m/m vs est. -3%
• Onshore yuan gains after PBOC strengthens fixing by 0.3%
  • USD/CNH could retreat to 6.7618 level in near term as pair crosses below 10-DMA first time in almost one month: Chart
• Peso little changed; currency weakness vs dollar not all bad, declines mainly driven by Fed rate hike jitters, Finance Secretary Carlos Dominguez says
  • President Duterte’s pivot to China positive for Philippines: Credit Suisse