Market Outlook 22 Jun - 28 Jun 2015

Transcription

1 Highlight Treasury Division TMU 01 :(66) TMU 02 :(66) TMU 03 :(66) Market Outlook 22 Jun - 28 Jun 2015 Last Week: The dollar depreciated against major peers as Dovish comment from Fed chair Janet Yellen that Fed will take a data-driven approach to timing of its hiking rate. Greece debt negotiation still in progress. This Week: This week the main theme is still on Greece debt negotiation, the situation has lower tension as Greece seems to accept the reformation condition from IMF and Euro group. Besides, U.S. will release the first quarter GDP on Wednesday (24/6). USD The USD opened on Monday (15/6) at 95.54, gained from Friday (12/6) closing level at as data showed that U.S. consumer sentiment improved more than expected this month and that U.S. producer prices rose slightly more than expected in May. At the beginning of the week, the dollar fell against its major peers as the released of downbeat US economic data. Empire state manufacturing index sharply declined to in June, compared to an expected increase of Moreover, industrial production declined by 0.2% in May, compared to an expected gain of 0.3%. The dollar depreciated continuously against its major peers after a relatively dovish FOMC declined to issue any explicit wording on the timing of its first rate hike in nearly a decade. Moreover, Federal Reserve chair Janet Yellen reiterated that the U.S. Central bank will take a data-driven approach to the timing of its first rate hike since June However, at the end of the week, the dollar trimmed losses after the report showed that initial jobless claims decreased by 12,000 to a four-week low of 267,000 from the previous week s total of 279,000. Furthermore, Philly fed manufacturing index climbed to 15.2 in May from 6.7 in the previous month, more than forecasted at 8.7. On Friday (19/6), the dollar index closed at

2 Graph: Dollar Index (DXY) Source: Reuters Comments: In the week ahead, we expect the dollar will rebound against its major peers after it dropped more than 1% last week as Fed declines to issue explicit wording on timing of rate lift-off and as the report showed some weakness U.S. economic data. Meanwhile, market will eye on existing home sales (22/6), new home sales (23/6), flash manufacturing PMI (23/6), durable goods orders (23/6) and Q1/2015 Final GDP (24/6). This week, the dollar index expect to move in a range of EUR & GBP Last week, the euro opened at /28 USD/EUR on Monday (15/6), depreciated from previous week closing level at /67 USD/EUR. The euro was under pressured as Greek impasse. The talks in Brussels between the indebted nation and its creditors collapsed after just 45 minutes on Sunday (14/6) meeting, with Greece seeking to unlock as much as 7.2 billion euro (8.1 billion USD) before its current rescue deal expire. On Tuesday (16/6), the euro fell after ZEW economic

3 sentiment shown that German investor confidence slid from 65.7 in May to 62.9 in June, below the forecast at The euro then continued to appreciate since midweek as the prospect of slow interest-rate increases in the U.S. disappointed dollar bulls. The Federal Reserve Chair Janet Yellen and her colleagues lowered the longerterm projections for U.S. interest rates, driving the dollar to fall against basket of currencies. However, the meeting of euro-area finance ministers in Luxembourg at the end of the week was breakdown with no conclusion. This made Greece lurched closer to an exit from the euro as the deadline is approached in a week. During the week, the euro moved within the range USD/EUR and closed on Friday (19/6) at /52 USD/EUR. The pound sterling opened at /65 USD/GBP on Monday (15/6). During the week, the pound continued to appreciate supported by a weak U.S. dollar and a minutes from Bank of England (BOE) suggested that the factors holding back the UK economy were fading, increased market expectation that BOE will do more tightening. The pound sterling approached seven-months high against the dollar on Thursday (18/6) at USD/GBP. During the week, the pound moved within the range USD/GBP and closed on Friday (19/6) at /84 USD/GBP. Graph: EUR &GBP

4 Source: Reuter Comments : The euro tends to be depreciated as Greece was still unable to reach the agreements with its creditors. The market will closely watch the talks among them before its current bailout about 1.5 billion euros (1.7 billion USD) expires on 30 June. The euro expects to be traded within a range of USD/EUR and the pound sterling expects to be traded within a range of USD/GBP. AUD & NZD The Australian dollar opened last Monday (15/6) at /17 USD/AUD, depreciated from last week closing level at /33 USD/AUD as the result from the previous Friday s upbeat U.S. data ;U.S. consumer confidence improved in June and producer price index also rose in May. The Aussie continued to fall on Tuesday(16/6) as Royal Bank of Australia s minutes from the most recent meeting held a dovish tone and reaffirmed that it would consider further rate cuts if necessary. The minutes indicated that the currency might need further depreciation, however the RBA said that they would assess information on economic and financial conditions and hence decide whether the current stance of policy would most effectively foster sustainable growth and inflation consistent with the target. Moreover, the leading index in May which give a sense of future state of an economy down 0.1% to from in April.On Wednesday(17/6),the currency dropped against its U.S counterpart and hit the week s low at USD/AUD on the morning session as the greenback remained support as investors hoped that the Fed s rate statement released later on the day would have any clear signal about a possible timeline for hiking interest rates. However, after the statement, the greenback adversely came under pressure after the Federal Reserve

5 lowered both its U.S. growth forecast and its interest-rate projections, prompting investors to push back expectations on the timing of an initial rate hike. As the result, the Australian dollar rebounded on late Wednesday (17/6) and made the week s high on Thursday(18/6) at USD/AUD before slid back and closed on Friday(19/6) at /70 USD/AUD. The New Zealand dollar opened last Monday(15/6) at /86 USD/NZD, almost the same level from last week closes at /82 USD/NZD.The kiwi still was pressured and hovered close to last week s nearly five-year สนไ since the beginning of the week after the U.S. dollar remained broadly supported by Friday's(12/6) upbeat U.S. economic data. On Wednesday (17/6), the report said that the country's current account swung into a surplus of NZ$0.66 billion in the first quarter of 2015 from a deficit of NZ$3.19 billion in the last three months of last year. Analysts had expected the current account to hit a surplus of NZ$0.23 billion in the last quarter. The kiwi, however, slid lower and hit the low of the week at USD/NZD as demand for the greenback strengthened ahead of the Federal Reserve's policy statement later in the day. The currency was able to bounced back instantly and reached the week high at USD/NZD after the dovish statement which is oppose of the prediction made by FED. On Thursday (18/6), The New Zealand dollar tumbled over 1% to five-year lows after data showed that New Zealand's economy grew at a slower pace than expected in the first quarter. The GDP of the country rose by 0.2% in the first quarter, confounding expectations for an increase of 0.6% on quarter basis while with year-onyear basis the GDP rose by 2.6 % less than the expectation of 3.0% increase. At the end of the week, the kiwi remained weaker and closed on Friday (19/6) at /12 USD/NZD. Graph: AUD and NZD

6 Source: Reuters Comment : Ahead of the coming week, investors will focus on the house price inflation of Australia released on Tuesday(23/6) and New Zealand trade balance released on Friday(26/6).The crisis in Greece and U.S. economic data will also be closely watched. The Aussie and the kiwi are expected to be traded between USD/AUD and USD/NZD respectively JPY The yen opened on last Monday (15/6) at /36 JPY/USD, remained stable from previous week closing level on Friday (12/6) at /39 JPY/US as investor awaiting for the result of the FOMC meeting (17/6) and the Bank of Japan (BOJ) meeting (19/6). However, the yen weakened against the US dollar on Wednesday (17/6) despite a narrower than expected trade deficit. Japan trade balance showed a deficit of 216 billion yen in May as the volume of exports dropped, slightly narrower than expected a deficit of billion yen. At the end of the week, the yen appreciated against the dollar as the dollar dropped against major currencies after the FED lowered both its interest rate projection and its U.S. growth forecast. Moreover, on Friday (19/6) the BOJ held policy steady as expected. The BOJ is now buying government bonds at a pace of 80 trillion yen per year and the board did conclude that the economy continued to recover moderately. Last week, the yen moved within the range of before closing at /67 on last Friday (19/6). Graph: JPY

7 Daily QJPY= Cndl, QJPY=, Bid 22/06/2015, , , , , +0.12, (+0.10%) SMA, QJPY=, Bid(Last), 14 22/06/2015, /06/ /06/2015 (GMT) Price /USD June Auto Source: Reuters Comments: This week, investors will focus on the minutes of the latest BOJ policy meeting on Wednesday (24/6), giving investors how officials view the economy and their policy option, and Japan will released report on inflation, household spending and unemployment on Friday (26/6). We expect that the yen will move in a range between JPY/USD in this week. THB The baht strengthened against the USD at the beginning of the week after the U.S. economic data came out mixed. Also, investors waited for the sign of interest rate hike from FOMC, which was held on June The baht touched its weakest level at THB/USD before the policy meeting ended. Later, the baht gained momentum against the USD after the Fed left the door slightly opened for a rate increase later this year, and saying that it will act after seeing further improvement. Moreover, the baht also strengthened after MR Pridiyathorn Devakula, Deputy prime minister, expressed confidence that the country could see economic growth of 3-4% this year. However, the BOT cuts its economic growth forecast for this year to 3% as it expects the pace of recovery will remains fragile

8 Graph: THB Daily QTHB= Cndl, QTHB=, Bid 22/06/2015, 33.63, 33.68, 33.53, 33.65, +0.01, (+0.03%) SMA, QTHB=, Bid(Last), 14 22/06/2015, /06/ /06/2015 (GMT) Price /USD June 2015 Source: Reuters Comments: This week, we expect the baht will move in narrow range of THB/USD since the lack of new factors. Investors will monitor the situation on Greece debt crisis. FX Forecast Currency Support Resistance THB/USD JPY/USD USD/EUR USD/GBP USD/AUD USD/NZD

9 Economic Calendar Last Week Date Time Event Survey Actual Prior 22-Jun JN Supermarket Sales YoY May % 22-Jun JN Convenience Store Sales YoY May % 22-Jun US Chicago Fed Nat Activity Index May Jun CA Bloomberg Nanos Confidence Jun EC Consumer Confidence Jun A Jun US Existing Home Sales May 5.28M M 22-Jun US Existing Home Sales MoM May 4.80% % 23-Jun JN Markit Japan PMI Mfg Jun P Jun FR Business Confidence Jun Jun FR Manufacturing Confidence Jun Jun FR Production Outlook Indicator Jun Jun FR Own-Company Production Outlook Jun Jun FR Markit France Manufacturing PMI Jun P Jun FR Markit France Services PMI Jun P Jun FR Markit France Composite PMI Jun P Jun GE Markit/BME Germany Manufacturing PMI Jun P Jun GE Markit Germany Services PMI Jun P Jun GE Markit/BME Germany Composite PMI Jun P Jun EC Markit Eurozone Manufacturing PMI Jun P Jun EC Markit Eurozone Services PMI Jun P Jun EC Markit Eurozone Composite PMI Jun P Jun IT Industrial Orders MoM Apr % 23-Jun IT Industrial Orders NSA YoY Apr % 23-Jun IT Industrial Sales MoM Apr % 23-Jun IT Industrial Sales WDA YoY Apr % 23-Jun IT Retail Sales MoM Apr 0.10% % 23-Jun IT Retail Sales YoY Apr -0.50% % 23-Jun UK CBI Trends Total Orders Jun Jun UK CBI Trends Selling Prices Jun Jun US Durable Goods Orders May -0.70% % 23-Jun US Durables Ex Transportation May 0.50% % 23-Jun US Cap Goods Orders Nondef Ex Air May 0.50% % 23-Jun US Cap Goods Ship Nondef Ex Air May % 23-Jun US FHFA House Price Index MoM Apr 0.50% % 23-Jun US Markit US Manufacturing PMI Jun P Jun US New Home Sales May 525K K 23-Jun US New Home Sales MoM May 1.60% % 23-Jun US Richmond Fed Manufact. Index Jun

10 24-Jun JN PPI Services YoY May 0.50% % 24-Jun JN Small Business Confidence Jun Jun FR GDP YoY 1Q F 0.70% % 24-Jun FR GDP QoQ 1Q F 0.60% % 24-Jun GE IFO Business Climate Jun Jun GE IFO Current Assessment Jun Jun GE IFO Expectations Jun Jun IT Hourly Wages MoM May % 24-Jun IT Hourly Wages YoY May % 24-Jun UK BBA Loans for House Purchase May Jun US MBA Mortgage Applications % 24-Jun US GDP Annualized QoQ 1Q T -0.20% % 24-Jun US Personal Consumption 1Q T 1.90% % 24-Jun US GDP Price Index 1Q T -0.10% % 24-Jun US Core PCE QoQ 1Q T 0.80% % 24-Jun FR Total Jobseekers May k k 24-Jun FR Jobseekers Net Change May Jun GE GfK Consumer Confidence Jul Jun UK CBI Reported Sales Jun Jun RU Gold and Forex Reserve B 25-Jun US Personal Income May 0.50% % 25-Jun US Personal Spending May 0.70% % 25-Jun US Real Personal Spending May 0.40% % 25-Jun US PCE Deflator MoM May 0.30% % 25-Jun US PCE Deflator YoY May 0.20% % 25-Jun US PCE Core MoM May 0.10% % 25-Jun US Initial Jobless Claims K K 25-Jun US PCE Core YoY May 1.20% % 25-Jun US Continuing Claims K K 25-Jun US Markit US Composite PMI Jun P Jun US Markit US Services PMI Jun P Jun US Bloomberg Consumer Comfort Jun US Kansas City Fed Manf. Activity Jun Jun JN Jobless Rate May 3.30% % 26-Jun JN Job-To-Applicant Ratio May Jun JN Overall Household Spending YoY May 3.60% % 26-Jun JN Natl CPI YoY May 0.40% % 26-Jun JN Natl CPI Ex Fresh Food YoY May 0.00% % 26-Jun JN Natl CPI Ex Food, Energy YoY May 0.40% % 26-Jun JN Tokyo CPI YoY Jun 0.50% % 26-Jun JN Tokyo CPI Ex-Fresh Food YoY Jun 0.10% %

11 26-Jun JN Tokyo CPI Ex Food, Energy YoY Jun 0.10% % 26-Jun GE Import Price Index MoM May 0.20% % 26-Jun GE Import Price Index YoY May -0.40% % 26-Jun FR Consumer Confidence Jun Jun EC M3 Money Supply YoY May 5.40% % 26-Jun EC M3 3-month average May 5.10% % 26-Jun IT Consumer Confidence Index Jun Jun IT Business Confidence Jun Jun IT Economic Sentiment Jun Jun US U. of Mich. Sentiment Jun F Jun US U. of Mich. Current Conditions Jun F Jun US U. of Mich. Expectations Jun F Jun US U. of Mich. 1 Yr Inflation Jun F % 26-Jun US U. of Mich Yr Inflation Jun F % This Week Date Time Event Survey Actual Prior 22-Jun JN Supermarket Sales YoY May % 22-Jun JN Convenience Store Sales YoY May % 22-Jun US Chicago Fed Nat Activity Index May Jun CA Bloomberg Nanos Confidence Jun EC Consumer Confidence Jun A Jun US Existing Home Sales May 5.28M M 22-Jun US Existing Home Sales MoM May 4.80% % 23-Jun JN Markit Japan PMI Mfg Jun P Jun FR Business Confidence Jun Jun FR Manufacturing Confidence Jun Jun FR Production Outlook Indicator Jun Jun FR Own-Company Production Outlook Jun Jun FR Markit France Manufacturing PMI Jun P Jun FR Markit France Services PMI Jun P Jun FR Markit France Composite PMI Jun P Jun GE Markit/BME Germany Manufacturing PMI Jun P Jun GE Markit Germany Services PMI Jun P Jun GE Markit/BME Germany Composite PMI Jun P Jun EC Markit Eurozone Manufacturing PMI Jun P Jun EC Markit Eurozone Services PMI Jun P Jun EC Markit Eurozone Composite PMI Jun P Jun IT Industrial Orders MoM Apr % 23-Jun IT Industrial Orders NSA YoY Apr % 23-Jun IT Industrial Sales MoM Apr % 23-Jun IT Industrial Sales WDA YoY Apr %

12 23-Jun IT Retail Sales MoM Apr 0.10% % 23-Jun IT Retail Sales YoY Apr -0.50% % 23-Jun UK CBI Trends Total Orders Jun Jun UK CBI Trends Selling Prices Jun Jun US Durable Goods Orders May -0.70% % 23-Jun US Durables Ex Transportation May 0.50% % 23-Jun US Cap Goods Orders Nondef Ex Air May 0.50% % 23-Jun US Cap Goods Ship Nondef Ex Air May % 23-Jun US FHFA House Price Index MoM Apr 0.50% % 23-Jun US Markit US Manufacturing PMI Jun P Jun US New Home Sales May 525K K 23-Jun US New Home Sales MoM May 1.60% % 23-Jun US Richmond Fed Manufact. Index Jun Jun JN PPI Services YoY May 0.50% % 24-Jun JN Small Business Confidence Jun Jun FR GDP YoY 1Q F 0.70% % 24-Jun FR GDP QoQ 1Q F 0.60% % 24-Jun GE IFO Business Climate Jun Jun GE IFO Current Assessment Jun Jun GE IFO Expectations Jun Jun IT Hourly Wages MoM May % 24-Jun IT Hourly Wages YoY May % 24-Jun UK BBA Loans for House Purchase May Jun US MBA Mortgage Applications % 24-Jun US GDP Annualized QoQ 1Q T -0.20% % 24-Jun US Personal Consumption 1Q T 1.90% % 24-Jun US GDP Price Index 1Q T -0.10% % 24-Jun US Core PCE QoQ 1Q T 0.80% % 24-Jun FR Total Jobseekers May k k 24-Jun FR Jobseekers Net Change May Jun GE GfK Consumer Confidence Jul Jun UK CBI Reported Sales Jun Jun RU Gold and Forex Reserve B 25-Jun US Personal Income May 0.50% % 25-Jun US Personal Spending May 0.70% % 25-Jun US Real Personal Spending May 0.40% % 25-Jun US PCE Deflator MoM May 0.30% % 25-Jun US PCE Deflator YoY May 0.20% % 25-Jun US PCE Core MoM May 0.10% % 25-Jun US Initial Jobless Claims K K 25-Jun US PCE Core YoY May 1.20% % 25-Jun US Continuing Claims K K

13 25-Jun US Markit US Composite PMI Jun P Jun US Markit US Services PMI Jun P Jun US Bloomberg Consumer Comfort Jun US Kansas City Fed Manf. Activity Jun Jun JN Jobless Rate May 3.30% % 26-Jun JN Job-To-Applicant Ratio May Jun JN Overall Household Spending YoY May 3.60% % 26-Jun JN Natl CPI YoY May 0.40% % 26-Jun JN Natl CPI Ex Fresh Food YoY May 0.00% % 26-Jun JN Natl CPI Ex Food, Energy YoY May 0.40% % 26-Jun JN Tokyo CPI YoY Jun 0.50% % 26-Jun JN Tokyo CPI Ex-Fresh Food YoY Jun 0.10% % 26-Jun JN Tokyo CPI Ex Food, Energy YoY Jun 0.10% % 26-Jun GE Import Price Index MoM May 0.20% % 26-Jun GE Import Price Index YoY May -0.40% % 26-Jun FR Consumer Confidence Jun Jun EC M3 Money Supply YoY May 5.40% % 26-Jun EC M3 3-month average May 5.10% % 26-Jun IT Consumer Confidence Index Jun Jun IT Business Confidence Jun Jun IT Economic Sentiment Jun Jun US U. of Mich. Sentiment Jun F Jun US U. of Mich. Current Conditions Jun F Jun US U. of Mich. Expectations Jun F Jun US U. of Mich. 1 Yr Inflation Jun F % 26-Jun US U. of Mich Yr Inflation Jun F %