News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Mixed
Oil - US Crude
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Bearish
Gold
Bearish
GBP/USD
Bearish
USD/JPY
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • Bitcoin (+2.4% @ $13,388) - Short-term overbought but weekly chart showing lots of bullish signs...#btc #bitcoin @DailyFXTeam https://t.co/ZyKLfwiIC8
  • Commodities Update: As of 14:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 0.86% Silver: 0.30% Gold: 0.23% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/dompeGRosg
  • 🇺🇸 CB Consumer Confidence (OCT) Actual: 100.9 Expected: 102 Previous: 101.3 https://www.dailyfx.com/economic-calendar#2020-10-27
  • Ahead of Australian CPI - $AUDNZD has continued its slide, now testing 200DMA (1.0626)
  • Turkish Finance Minister says Turkey has no plans for capital controls, adds that the Turkish Lira was impact from tourism industry losses $TRY
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.89%, while traders in NZD/USD are at opposite extremes with 72.52%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/RKpFSZgfSJ
  • Commodities Update: As of 13:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 0.84% Gold: 0.17% Silver: -0.02% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/0xJvicGHk5
  • Heads Up:🇺🇸 CB Consumer Confidence (OCT) due at 14:00 GMT (15min) Expected: 102 Previous: 101.8 https://www.dailyfx.com/economic-calendar#2020-10-27
  • Indices Update: As of 13:00, these are your best and worst performers based on the London trading schedule: US 500: 0.10% Wall Street: -0.03% FTSE 100: -0.36% Germany 30: -0.52% France 40: -1.19% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/SoFNFa3DG8
  • The ECB will be in focus for the Euro this week and with the outlook deteriorating for the Eurozone. Get your $EURUSD market update from @JMcQueenFX here: https://t.co/SQzcMoj5QR https://t.co/tiJe3pDa1S
USD ASEAN Volatility Ahead, Will INR Reverse on Soft Indian CPI?

USD ASEAN Volatility Ahead, Will INR Reverse on Soft Indian CPI?

2019-07-08 04:30:00
Daniel Dubrovsky, Analyst
Share:

ASEAN Fundamental Outlook

  • ASEAN FX mostly resilient despite best week for USD this year
  • Indian Rupee gains on budget deficit may be offset by soft CPI
  • Will Bank of Malaysia sink MYR? Can Fed speak boost USD?

Trade all the major global economic data live and interactive at the DailyFX Webinars. We’d love to have you along.

US Dollar Soars as ASEAN Currencies Mostly Remain Resilient

Looking at DXY, the US Dollar experienced its best week against its major counterparts this year thus far. But, this was not enough to compel similar performance against some of its ASEAN and South Asian peers. The backdrop of strength in USD was due to the aftermath of the G20 Summit and a solid jobs report from the United States. The latter helped cool aggressive Fed rate cut bets for July.

A notable outperformer from the region was the Indian Rupee, with USD/INR extending its downtrend as anticipated. A few fundamental developments likely lead to this. Frist, Indian courts allowed ArcelorMittal, a multinational steel-producing company, to proceed with purchasing Essar Steel India Ltd. This likely fueled capital inflow bets as this would open the company to entering a major steel-producing nation.

The decision for ArcelorMittal to proceed with purchasing the financially-struggling company may be challenged in higher courts. Meanwhile, the Rupee extended gains after India’s government announced a smaller-than-expected budget deficit target of 3.3% of GDP for fiscal year 2020, cooling concerns about higher bond yields. Yet, the Nifty experienced its worst day in weeks as Finance Minister Nirmala Sitharaman also announced taxes on gas and oil while also raising them for high-income earners.

USD ASEAN Volatility Ahead, Will INR Reverse on Soft Indian CPI?

USDMYR Eyeing Bank of Malaysia

Ahead, the Malaysian Ringgit is looking to the next central bank monetary policy announcement. The Bank of Malaysia is widely anticipated to keep the overnight policy rate unchanged at 3.00% after cutting it back in May. Inflation is still low in the nation with palm oil, a key source of revenue for the country, down almost 10% (futures) since the beginning of this year. A hint that the central bank may yet cut rates again risks weakening MYR.

Chinese Economic Data

The week ahead also contains a couple of important Chinese economic data. The first of which is CPI and PPI for June on Wednesday. Then, on Friday we will get trade data for the same month. Relative to economists’ expectations, data outcomes are still tending to increasingly disappoint in the world’s second-largest economy.

If this pattern persists, it may continue to fuel concerns about the health of the global economy. This also poses a risk for regional trading partners such as the Philippines and Singapore. For the Singapore Dollar, it may look past local second quarter GDP data when comparing it against the US Dollar. USD/SGD tends to closely trace the Greenback compared to some of its ASEAN peers.

Indian Rupee Eyeing CPI Data

Meanwhile, the Indian Rupee will be nervously eyeing local inflation data. In June, Indian CPI is anticipated to clock in at 3.2% y/y, up from 3.05% in May. Yet, this is below the central bank’s 4% price target and is part of the reason why the Reserve Bank of India cut rates three times this year thus far. As such, a softer outcome may fuel further easing bets and depreciate INR.

USD Eyes Fed Speak, CPI and FOMC Minutes

There is plenty of event risk abroad from the United States that may also impact MYR, PHP, INR, SGD and IDR. After last week’s jobs report and US-China trade truce, markets will be looking to commentary from Fed members such as James Bullard, Charles Evans and Chair Jerome Powell. Expectations of a cut in July are still fully priced in with more expected to come.

If policymakers err on the side of caution and show any signs of hesitation of acting too quickly and aggressively, that could fuel risk aversion and a premium for liquidity. That stands to potentially boost the haven-linked US Dollar. However, a disappointing headline CPI report and FOMC minutes, also due this week, that keep chances of cuts this year on the table might just do the opposite.

FX Trading Resources

--- Written by Daniel Dubrovsky, Currency Analyst for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES