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FX/RATES DAYBOOK EUROPE: Kiwi, Aussie Rise; U.K. Mortgage Data

(Bloomberg) — Kiwi rebounded after falling briefly on RBNZ
Governor Wheeler’s comment a weaker currency is needed to
increase tradables inflation. Aussie dollar hovers below 0.80
versus the greenback after building and construction data beat
expectations.
TODAY
* Eurozone August consumer, economic, industrial and services
confidence
* Germany, Spain CPI
* Sweden consumer, manufacturing confidence
* UK mortgage approvals
* BOE’s Charlotte Gerken speaks in Edinburgh

OVERNIGHT TRADING SESSIONS
* U.S. TUESDAY
** Bloomberg dollar index recovered from a 0.5% decline Tuesday
to gain ~0.2%; EUR/USD fell from overnight high to settle below
1.2000, while USD/JPY rebounded to gain 0.4% to ~109.67; UST 10Y
fell ~3bps to 2.1275%, after earlier plunging to lowest since
November
* ASIA WEDNESDAY
** Kiwi weighed by Wheeler’s rhetoric while Aussie dollar
supported by better-than-expected 2Q construction work done and
building approvals data
** Bloomberg dollar index grinds lower weighed down by Aussie
rally
** U.S. 10-year yield climb 2bps
** Asian currencies were mixed to firmer with Korean won leading
the recovery

TOP OVERNIGHT NEWS
* Kim Says Missile Over Japan Was ‘Prelude’ to Containing Guam
** Trump says all options remain on table to deal with Kim
* Wall Street, Not Waiting on Mnuchin, Readies Debt-Limit War
Room
** Sifma revisiting, revising 2011, 2013 contingency plans
* RBNZ’s Wheeler Calls for Lower N.Z. Dollar to Boost Inflation
** “A lower New Zealand dollar is needed to increase tradables
inflation and help deliver more balanced growth,” says Wheeler
* U.K. Asked EU for More Time to Talk Brexit as Reality Sinks in
** Hope fading that enough progress can be made by October
summit
* Brexit-Driven Pound Drop Tests How ‘Indifferent’ Carney Can Be
** Trade-weighted rate close to level when Carney last commented
* Bond, Dollar Traders Won’t Let Missiles Distract Them From Fed
** For bond and currency traders, the primary focus is still on
U.S. monetary policy

KEY VIEWS
* Nomura Cautious on Kiwi Due to RBNZ, AUD/NZD to Stay Supported
** Nomura continues to hold a cautious stance on the New Zealand
dollar following the RBNZ’s latest tone, says FX strategist
Peter Dragicevich.
* EUR/USD to Reach 1.28, AUD/USD at 0.85 by End-2018, CBA Says
** The U.S. dollar has fallen faster than anticipated and this
has spurred another revision to forecasts for the greenback,
according to CBA

DATA RELEASED OVERNIGHT
* Japan July retail sales +1.1% m/m vs est. +0.3% m/m
* Japan July retail sales +1.9% y/y vs est. +1.0% y/y
* Australia 2Q construction work done +9.3% vs est. 1.0%
* Australia July building approvals -1.7% m/m vs est. -5.0% m/m
* Australia July building approvals -13.9% y/y vs est. -16.6%
y/y
* New Zealand July building permits -0.7% m/m vs revised -1.3%
in June

ECONOMIC DATA (All times CET):
* 1:01am: (UK) Aug. BRC Shop Price Index YoY, prior -0.4%
* 8am: (NO) July Retail Sales W/Auto Fuel MoM, est. 0.3%, prior
-0.63%
* 9am: (SW) Aug. Consumer Confidence, est. 103, prior 102.2
* 9am: (SW) Aug. Manufacturing Confidence s.a., est. 119.3,
prior 120.3
* 9am: (AS) July PPI YoY, prior 1.4%
* 9am: (SP) Aug. CPI YoY, est. 1.7%, prior 1.5%
* 9am: (SP) Aug. CPI EU Harmonised YoY, est. 1.8%, prior 1.7%
* 10am: (AS) Aug. Bank Austria Manufacturing PMI, prior 60
* 10:30am: (UK) July Net Consumer Credit, est. 1.5b, prior 1.5b
* 10:30am: (UK) July Net Lending Sec. on Dwellings, est. 3.8b,
prior 4.1b
* 10:30am: (UK) July Mortgage Approvals, est. 65,500, prior
64,700
* 10:30am: (UK) July M4 Money Supply YoY, prior 5.3%
* 10:30am: (UK) July M4 Ex IOFCs 3M Annualised, prior 5.4%
* 11am: (EC) Aug. Economic Confidence, est. 111.3, prior 111.2
* 11am: (EC) Aug. Industrial Confidence, est. 4.7, prior 4.5
* 11am: (EC) Aug. Services Confidence, est. 13.9, prior 14.1
* 11am: (EC) Aug. Consumer Confidence, est. -1.5, prior -1.5
* 11am: (EC) Aug. Business Climate Indicator, est. 1.1, prior
1.1
* 11am: (IT) July PPI YoY, prior 3.1%
* 2pm: (GE) Aug. CPI YoY, est. 1.8%, prior 1.7%
* 2pm: (GE) Aug. CPI EU Harmonized YoY, est. 1.7%, prior 1.5%

GOVERNMENT (All times CET):
* Aug. 30-Aug. 31: (FI) Finnish Government Drafts Country’s 2018
Budget
* Aug. 30-Sept. 1: (UK) U.K. Prime Minister May Visits Japan
* 9am: (SZ) Swiss Government Holds Regular Meeting
* 10:15am: (SW) Swedish PM Lofven Holds Press Conference
* 12pm: (EC) EU’s Juncker, Merkel Meet for Working Lunch in
Berlin

CENTRAL BANKS (All times CET):
* 11:45am: (UK) BOE’s Charlotte Gerken speaks in Edinburgh

BOND SALES/PURCHASES (All times CET):
* For corporate bonds, see New Issue Monitor
* 10:30am: Denmark to Sell Bills
* 11am: Italy to Sell Up to EU3.0b 0.9% 2022 Bonds
* 11am: Greece to Sell EU875.0m 182-Day Bills
* 11am: Italy to Sell Up to EU2.5b 2.05% 2027 Bonds
* 11am: Italy to Sell Up to EU1.75b Floating 2024 Bonds
* 11:03am: Sweden to Sell SK2.5b 110-Day Bills
* 11:03am: Sweden to Sell SK7.5b 201-Day Bills
* 11:05am: Norway to Sell NK3.0b 1.75% 2027 Bonds

MARKETS
* USD/JPY +0.1% to 109.77 (range 1.0955-1.0992)
* EUR/USD +0.1% to 1.1978 (range 1.1963-1.1979)
* AUD/USD +0.6% to 0.7995 (range 0.7947-0.7996)
* NZD/USD +0.2% to 0.7268 (range 0.7232-0.7269)
* GBP/USD +0.1% to 1.2927 (range 1.2918-1.2929)
* USD/CHF -0.1% to 0.9552 (range 0.9545-0.9570)
* USD/CAD steady at 1.2507 (range 1.2506-1.2525)

TECHNICAL OUTLOOK by Bloomberg strategist David Finnerty
* USD/JPY – Trying to consolidate
** Resistance: 111.05, Aug. 4 high; 112.20, July 26 high;
113.58, July 14 high
** Support: 108.27, Aug. 29 low; 108.13, April 17 low; 107.49,
July 21, 2016 high
* EUR/USD – Short-term high maybe in place
** Resistance: 1.2070, Aug. 29 high; 1.2167, 50% retracement of
May 2014 to Jan. 2017 decline; 1.2288, June 1, 2012 low
** Support: 1.1910, Aug. 2 high; 1.1847, Aug. 11 high; 1.1689,
Aug. 9 low
* EUR/JPY – Trying to push higher
** Resistance: 131.64, Aug. 30 intra-day high; 132.32, Jan. 29,
2016 high; 134.50, Dec. 3, 2015 high
** Support: 129.66, Aug. 29 low; 129.24, 50-DMA; 127.56, Aug. 18
low

To contact the reporter on this story:
David Finnerty in Singapore at dfinnerty4@bloomberg.net
To contact the editors responsible for this story:
Tan Hwee Ann at hatan@bloomberg.net
Patricia Lui

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