| Time | Country | Event | Period | Previous value | Forecast | Actual |
|---|
| 03:00 | China | Trade Balance, bln | July | 99.05 | 98 | 84.65 |
| 06:00 | Germany | Trade Balance (s.a.), bln | June | 25.3 | 23.5 | 20.4 |
| 06:00 | Germany | Industrial Production s.a. (MoM) | June | -3.1% | 1.0% | 1.4% |
During today's Asian trading, the U.S. dollar rose moderately against major currencies, continuing yesterday's increase, while market participants adjusted their expectations regarding the prospects for easing the Fed's monetary policy.
The US Dollar Currency Index (DXY), which tracks the dynamics of the dollar against six currencies (euro, swiss franc, yen, canadian dollar, pound sterling and swedish krona) rose by 0.25% to 103.22. Yesterday, the index added 0.11%, while San Francisco Fed President Mary Daly said she expects interest rates to fall later this year, but declined to provide a timetable or degree of policy easing. Given that markets expect aggressive cuts starting in September, Daly said that progress in inflation and a clear slowdown in hiring are likely to prompt the Fed to ease policy somewhat. According to the CME FedWatch Tool, markets see a 66.5% probability of a 0.5% rate cut in September, and a 58.6% probability of 0.25% rate cut in November. Overall, futures impose 105 basis points of cuts this year. Meanwhile, economists said Fed Chair Jerome Powell is likely to provide definitive guidance at this year's Jackson Hole Economic Symposium in August.
The yen fell 1.3% against the US dollar after Bank of Japan Deputy Governor Shinichi Uchida downplayed the likelihood of a rate hike in the short term. "As we are seeing sharp volatility in domestic and overseas financial markets, it's necessary to maintain current levels of monetary easing for the time being," Uchida said. Overall, his comments contrasted with the hawkish statements made by Bank of Japan Governor Kazuo Ueda last week. The BOJ's hike last week along with bouts of interventions from Tokyo in early July led investors to bail out of once-popular carry trades. But Uchida's comments could still prop up the carry trade, investors say, even with more room for unwinding of the trades.
The New Zealand dollar rose 0.9% against the US dollar on the back of strong labor market data. Statistics New Zealand said that in Q2 employment was up 0.4% versus expectations for a decline of 0.2%, which would have been unchanged from the three months prior. The participation rate was 71.7% - beating forecasts for 71.3% and up from 71.5% in Q1. Meanwhile, the unemployment rate rose to 4.6% from 4.4% in the 1st quarter. Economists had expected an increase to 4.7%.