Asia Round up Eurusd Trades Below $1.12 As Greek Story Comes to a Head- June 30th, 2015

Market Roundup

  • ECB Coeure – Grexit now a possibility.
  • Japan Econ Min Amari- Shouldn’t overestimate effect of Greek debt crisis on global economy, Japan in midst of emerging from deflation, there will be periods when economy moves sideways.
  • Japan May total cash earnings +0.6% y/y, real wages -0.1%, overtime -1.6%.
  • Japan SMBC nearing deal for GE’s European private equity finance unit, to pay more than $2 bln.
  • China PBOC lowers benchmark 7-day reverse repo rate 20 bps to 2.5%.
  • UK June GKF consumer confidence index +7, 15-year high, +2 eyed, May +1.
  • Australia May private-sector credit +0.5% m/m, as eyed, housing +0.5%.
  • Australia May HIA new home sales -2.3% m/m, multi-units at record high though.
  • NZ June biz confidence index net -2.3%, lowest in 4+ years, outlook +23.6%, May +15.7%, +32.6%.
  • NZ May new dwelling consents unch m/m, +3.1% y/y, April -0.9% m/m.

Economic Data Ahead

  • (0200 ET/0600 GMT) Germany May retail sales, unchanged m/m eyed; last +1.3%.
  • (0245 ET/0645 GMT) France May consumer spending, -0.1% m/m eyed; last +0.1%.
  • (0245 ET/0645 GMT) France May producer prices; last -0.4% m/m.
  • (0300 ET/0700 GMT) Switzerland June KOF sentiment indicator, 93.5 eyed; last 93.1.
  • (0355 ET/0755 GMT) Germany June unemployment, 6.4% sa, -5k sa eyed; last 6.4%, -6k.
  • (0355 ET/0755 GMT) Germany June unemployment, 2.71 mln nsa eyed; last 2.76 mln nsa, 2.79 mln sa.
  • (0400 ET/0800 GMT) Italy May unemployment, 12.3% eyed; last 12.4%.
  • (0400 ET/0800 GMT) Norway May credit indicator, +5.8% y/y eyed; last +5.7%.
  • (0400 ET/0800 GMT) Spain April current account balance; last E950 mln surplus.
  • (0430 ET/0830 GMT) UK Q1 GDP – revised, +0.4% q/q, +2.5% y/y eyed; prelim +0.3%, +2.4%.
  • (0430 ET/0830 GMT) UK Q1 Current account balance, bln deficit eyed; last GBP25.3 bln deficit.
  • (0500 ET/0900 GMT) Euro zone May unemployment, 11.1% eyed; last 11.1%.
  • (0500 ET/0900 GMT) Euro zone June inflation – flash, +0.2% y/y eyed; last +0.3%, ex-f/e +0.9%.
  • (0500 ET/0900 GMT) Italy June CPI prelim, +0.1% m/m, +0.1% y/y eyed; last +0.1%, +0.1%.
  • (0500 ET/0900 GMT) Italy June HICP – prelim, +0.1% m/m, +0.2% y/y eyed; last +0.2%, +0.2%.
  • (0600 ET/1000 GMT) Italy May producer prices; last -0.1% m/m, -2.3% y/y.
  • (0900 ET/1300 GMT) US April CaseShiller 20, +0.8% m/m sa, +5.5% y/y eyed; last +1.0%, +5.0%.
  • (0945 ET/1345 GMT) US June Chicago PMI, 50.0 eyed; last 46.2.
  • (1000 ET/1400 GMT) US June consumer confidence index, 97.3 eyed; last 95.4.
  • (1030 ET/1430 GMT) US June Dallas Fed services revenues, outlook indices; last 3.8, 1.1.

Key Events Ahead

  • N/A Belgium 3/6-month treasury certificate auctions.
  • (0300 ET/0700 GMT) Finland quarterly report on debt management, outlook.
  • (0400 ET/0800 GMT) Norway July currency operations, June NOK700 mln net sales/day.
  • (0440 ET/0840 GMT) BoE Fisher speech at Financial Times event in London.
  • (0500 ET/0900 GMT) Italy E1-1.5/2-3 bln 0.7/1.5% 2020/25 BTP auctions.
  • (0500 ET/0900 GMT) Italy E2-2.5 bln 0.304% 2022 index-linked BTP auction.
  • (0530 ET/0930 GMT) ECB refinance at fixed 0.05%, E90 bln allotment eyed, last bln.
  • (0535 ET/0935 GMT) NY Fed Dudley speech at Basel CPMI conference.
  • (0700 ET/1100 GMT) BoE Haldane speech in Milton Keynes.
  • (0800 ET/1200 GMT) Buba VP Buch press conference on financial stability.
  • (0900 ET/1300 GMT) ECB/Austria CB Nowotny speech at Vienna event.
  • (1200 ET/1600 GMT) EU Juncker speaks in Brussels.
  • (1330 ET/1730 GMT) EU/Dutch FinMin Dijsselbloem parliamentary testimony at The Hague.
  • (1800ET/2200 GMT) St Louis Fed Bullard speech at St Louis conference.

FX Recap

EUR/USD is supported around 1.1200 levels and currently trading at 1.1187 levels. It has made intraday high at 1.1238 and low at 1.1180 levels. Pair gave back previous gains and turned deep in red versus the US dollar in mid-Asia, trading below 1.1200 levels. The European currency was heavily sold-off as markets once again shifted attention towards Greek debt story with increased bets of a likely Greek default at the repayment deadline expires today. Greece now waits for a referendum on July 5 which will decide whether or not its people would like to see austerity measures set out by creditors met, or if they would rather face leaving the European Union. Markets will remain glued on Greece updates while a flurry of key Euro zone data will keep the EUR trader busy in the session ahead. Initial support is seen around 1.1067 and resistance is seen around 1.1218 levels.USD/JPY is supported below 123.00 levels and posted a high of 122.71 levels. It has made intraday low at 122.18 and currently trading at 122.30 levels. The major keeps its downside bias intact as the traders favoured safe-haven appeal in yen as the Greek situation continues to roil global markets. Further, the latest updates on Greece, citing that Greece once again rejected the last minute opportunity offered by European commission President Juncker just ahead of today IMF repayment deadline. Markets flocked to safety asset on this news, hence supporting the upbeat momentum in JPY. Looking ahead, we have a data-packed European session, beside all eye will be on Greece headlines which is likely to be the major market mover today. Near term resistance is seen at 124.57 and support is seen at 121.48 levels.GBP/USD is supported above $1.5700 levels. It made an intraday high at 1.5736 and low at 1.5718 levels. Pair is currently trading at 1.5730 levels. Sterling hit a 7 1/2-year high against the euro on Monday as people looked for safe havens after Greece’s debt crisis worsened and Athens imposed capital controls. Today UK will release Final GDP as well as current account data. New revisions that official statisticians introduced this month are expected to boost the headline measures of UK GDP for this and the previous year. Initial support is seen at 1.5624 and resistance is seen around 1.5835 levels.USD/CHF is supported around 0.9300 levels and trading at 0.9302 levels and made intraday low at 0.9245 and high at 0.9307 levels. The Swiss National Bank Chief Jordan confirmed that the bank intervened in the FX markets on Monday as the Swiss Franc faced the risk of appreciation due to safe haven appeal. He said the bank is prepared for Grexit, while adding that the default would be extremely difficult situation for the Greek banks. The intervention yesterday was mainly to stem the rise in the CHF due to the Greece led risk aversion across the globe. Today Switzerland will release KOF indicator for the further direction. Near term support is seen at 0.9279 levels and resistance is seen at 0.9428 levels.AUD/USD is supported below 0.7700 levels and trading at 0.7675 levels. It has made intraday high at 0.7682 levels and low at 0.7658 levels. Moreover, higher gold prices on increased safe-haven bids on Greece crisis are also supports the resource-linked Aussie. However, the upside remains capped on underlying Greek concerns continues to dampen investors’ sentiments, weighing on risk-sensitive currencies lower. Downward pressure has clearly eased with the strong rebound. Mixed indicators suggest sideway trading from the time being. Initial support is seen at 0.7568 and resistance at 0.7838 levels.

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