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Asia Recap: Pound annihilated on Scottish poll news

FXStreet (Bali) - The British Pound was dumped across the board in the early stages of inter-bank trading, following weekend poll results that show Scottish independents leading the referendum by a narrow lead.

As Reuters reported: "Supporters of Scottish independence have taken their first opinion poll lead since the referendum campaign began, according to a YouGov survey for the Sunday Times newspaper. With less than two weeks to go before the Sept. 18 vote, the poll puts the "Yes" to independence campaign on 51 percent, with the unionists on 49 percent, overturning a 22-point lead for the unionist campaign in just a month..."

GBP/USD took a big hit (150 pips gap lower), breaking through critical support area at 1.6230, reaching its lowest level since late Nov last year at 1.6167 before bargain hunters made their appearance at the open of the retail platform at 21GMT. EUR/USD kept being pressured, threatening a break of 1.2920 again, currently at 1.2936 session low. AUD/USD opened with a 15 pips down-gap, but saw solid demand off lows again, keeping the currency in a tight 0.9360-75 range. Meanwhile, USD/JPY tested 105.20 offers, but no follow through was found, resulting in a consolidation marginally above 105.00. NZD/USD traded in familiar ranges centered at 0.8320 ahead of Thursday's RBNZ monetary policy decision.

On the fundamental front, plenty of headlines to chew on. Out of the UK, Chancellor Osborne was quoted as saying that "no ifs, no buts, we will not share the pound if Scotland separates from the rest of the UK." The other key story over the weekend was further evidence emerging that Ukraine-Russia ceasefire was collapsing, with Reuters reporting prolonged artillery fire in the port of Mariupol and around Donetsk airport, despite the Presidents of Ukraine and Russia said the ceasefire was holding fairly well. In the US, Federal Reserve Bank of Philadelphia President Charles Plosser, was quoted saying “I would prefer that we start to raise rates sooner rather than later.” In Russia, the Foreign Ministry said that they ‘will react’ if EU implements new sanctions.

In the Asian calendar, we had weak data out of New Zealand, with Q2 manufacturing activity volume QoQ coming at -0.7% vs +0.5%, further suggesting that the economic momentum in the country may have stalled somewhat. In Japan, the current account balance for July came at ¥ 416.7Bn vs ¥ 444.2B, with the final GDP read confirming the economy contracted the most since 2009, as the GDP (seasonally adjusted) for Q2 printed -1.8%, unchanged from preliminary. In Australia, ANZ job advertisements data for August stood at +1.5% MoM vs +0.5, a positive surprise that contradicts the worsening jobless rate from July. Lastly, in China, the August trade balance came at $49.83bn vs $40.00bn expected.

Main headlines in Asia

British Pound hammered on new Scottish poll result

Scottish independence 'yes' takes narrow poll lead

Russia,Ukraine presidents say ceasefire holding fairly well

Ukraine, Russia ceasefire collapsing? fresh shelling around Donetsk airport

New Zealand Manufacturing sales down to -0.7% in 2Q from previous 0.5%

NZ manufacturing sector to make neutral contribution to Q2 GDP - ANZ

Japan GDP: Worst contraction since Q1 2009

Australia ANZ Job Advertisements rose from previous 0.3% to 1.5% in August

China Trade Balance above forecasts ($40B) in August: Actual ($49.83B)

China Imports (YoY) registered at -2.4%, below expectations (1.7%) in August

China Exports (YoY) came in at 9.4%, above expectations (8%) in August

NZ FinMin: National party will keep interest rates low

AUD/USD is close to 0.9370 pivot

AUD/USD dipped to 0.9361 early in Asia on the back of GBP/USD movement. Currently the pair has recovered towards the pivotal level of 0.9370; 0.9376/80 resistance is in sight.
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