Halister News

(Bloomberg) -- AUD surges as RBA says economic conditions in China have steadied and inflation is seen “climbing gradually” over the next two years, even as rates were left unchanged. BOJ also held policy and said risks to both growth and CPI are skewed to downside;

• Investor attention is shifting to BOJ’s November bond-buying plan due today, which may outweigh rates decision
• BBDXY falling for third day, -0.06% to 1,207.48
• 10-year Treasury yield up 2bps to 1.85%
• Oil, copper rising while gold is little changed
• AUD/USD +0.59% to 0.7654 vs 0.7598-0.7659 range
• AUD is bought by macro funds responding to RBA’s China view and noting that house prices are rising in some markets: traders
• NOTE: China factory PMI for October rose to 2-year high, beat forecast
• Some investors also cite RBA’s reference to gradual pickup in inflation, says another trader
• USD/JPY +0.1% to 104.87 vs 104.67-104.97 range
• Pair rose initially before slipping back to near unchanged after BOJ lowered FY2017 core CPI forecast to 1.5% vs 1.7%; sees CPI hitting 2.0% in 2018
• USD/CAD is steady after a 5-day gain, little changed at 1.3415
• UBS raises year-end forecast to 1.36 from 1.25 as cheaper oil is negative for CAD, along with risk of lower inflation readings; story here
• NOTE: Mark Cranfield is an FX strategist who writes for First Word. The observations he makes are his own and are not intended as investment advice.