July 05, 2024 at 05:01AM
Mt Gox and German cops hit Bitcoin lower, under US$56K
European Central Bank President Lagarde is speaking again on Friday
Japan finance minister Suzuki says weak yen is pushing up import costs
New York Federal Reserve President John Williams speaks on Friday, pre NFP
More on the People’s Bank of China move to stabilize government bond yeilds
PBOC sets USD/ CNY reference rate for today at 7.1289 (vs. estimate at 7.2704)
The PBOC is preparing capacity for large scale yuan bond sales
US non-farm payrolls data – the key ranges for estimates to watch
Julius Baer like further upside in Japanese equities
Japan official with excuses for poor household spending in May
Japan data – May household spending -1.8% y/y (expected +0.1%)
Election result gives green light to August BoE rate cut – GBP to drift lower
US media – wealthy Democratic donors say won’t finance the party until Joe Biden drops out
UK political stability (relative to elsewhere) will support UK markets ahead
ICYMI – ECB’s Lagarde says the Bank needs to see more data to see inflation towards 2%
GBP is little changed after the UK election exit poll
UK exit poll tips a solid win to Labour, 410 seats – new UK government incoming
Reserve Bank of New Zealand policy meeting next week – rates to be left on hold
Forexlive Americas FX news wrap: USA-on-holiday edition
Trade ideas thread – Friday, 5 July, insightful charts, technical analysis, ideas
Preview: June non-farm payrolls by the numbers — the headwinds are starting to blow
There
were a couple of notable news events during the session; the UK
election results and the PBOC preparing to build a war chest of bonds to sell.
From
the UK we had as-expected election result. A massive landslide win
for the Labour Party and a disastrous loss for the incumbent
Conservative Party. We are still awaiting full results but the exit
poll showed:
Labour
to win 410 seats, the most by any party since 2001
Conservatives
routed with 131 seats, the fewest since the party was founded in
1834 (190 years if you are counting)
Liberal
Democrats on 61
Reform
UK on 13, leader Nigel Farrage won a seat
SNP
10
Greens
2
GBP
has barely moved after the election. A huge win for Labour was
forecast in the weeks leading up to the poll.
The
other big news was from China, where the People’s Bank of China
signed agreements with major banks/institutions to borrow Chinese
treasury bonds. The Bank will sell these bonds when it sees fit, and
based on market conditions, to drive prices lower/yields higher.
Chinese government bonds have been rising strongly (yields lower) and
its this move the PBOC is aiming to combat.
The
favouring of risk FX over the USD carried on, with AUD, NZD, EUR and
GBP rising a little on the session. The CHF rose also.
Meanwhile,
the yen gained ground. It registered losses earlier in the session, a
catalyst seeming to be very, very poor household consumption data
(see bullets above). USD/JPY rose to highs circa 161.40 but soon
retraced. The downside momentum for USD/JPY (ie stronger yen) was
added to by some more forthright than usual remarks from Japan’s
finance minister Suzuki.
The
cryptyo complex lost ground. BTC/USD dropped under US$56K (see bullets
above).
This article was written by Eamonn Sheridan at www.forexlive.com.
