Trade The News | Oct 12, 2012 10:04AM ET
Economic Data
Asian equity markets are mixed headed into the weekend as bearish momentum from US indices over the past few days was stalled by better than expected weekly jobless claims data. Investors turn to economic data out of China, namely trade tomorrow and inflation figures early next week for more signs over the extent of its slowdown ahead of next month's political transition. September lending figures may also be released over the weekend or overnight, just as PBoC Vice Gov Liu expressed concern over low level of corporate appetite for loans.
Major currency pairs stuck to narrow ranges with the exception of Singapore dollar. Singapore Q3 GDP came in better than expected, while Q2 was revised from contraction to expansion, keeping its economy out of technical recession. Counter to expectations of more focus on rising SGD, MAS instead chose to maintain its policy of gradual appreciation of SGD with no change to width or midpoint. USD/SGD fell sharply by over 80 pips on broad SGD strength, briefly falling to a 1-month low below S$1.22 handle. Singapore also affirmed 2012 GDP remaining on track to grow 1.5-2.5% and forecasted 2013 CPI at 3.4-4.5%.
IMF unveiled its Asia-Pacific Regional Economic Outlook that pinned the chance of Asia 2013 growth remaining below 4% at just over 10%. IMF also called for more action from Japan to achieve its 1% inflation target, while also noting that risks to Asia remain considerable.
Japan Cabinet Office lowered its monthly economic assessment for the 3rd consecutive month, noting industrial production is decreasing and recovery was weak due to the global slowdown. Corporate sentiment assessment was also cut for the first time since Dec 2011, as manufacturers voiced increasing concern amid the recent Sino-Japanese tensions. Japanese Yen firmed late in the day, falling over 20 pips from session high to ¥78.30.
Fixed Income/Currencies/Commodities
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