Asian Stocks Weak And Greenback Strong After Another Trade War Burst
Asian stock market staged some broad losses yesterday after Donald Trump officially declared that he will hit China with 25% tariffs on $200 billion of Chinese goods. Shanghai SSE dropped -2.45%. HK HSI reduced -2.3%. Nikkei fell -0.4%. Singapore Strait Times declined -1.3%. US 10 year yield regained 3% handle after the news. Japanese Yen and dollar both reinforced. Aussie and Pound weakened. Today’s notable event is Bank of England meeting, where members are expected to execute a 25bps rate hike to 0.75%.
US Treasury Department decided to increase long term debt issuance by 5 billion dollars to 78 billion dollars this quarter, which marked 3rd straight raise. According to the Congressional Budget Office, the fiscal deficit should grow to 1 trillion dollars by 2020. 10 year yield rose 0.039 to 3.003.
Japanese monetary base increased 7.0% yoy in July. Australian trade surplus extended to 1.87 billion Aussie in June. Today, Swiss will feature SECO consumer confidence, retail sales and PMI, Britain will announce PMI construction, Eurozone will present PPI and US will publish Challenger job cuts, unemployment claims and factory orders.