Ranges (Up till 11.

50am HKT)
Currency

0.7280. AudUsd backed off as Chinese equity indices

turn negative.

Currency

EURUSD

1.13285-595

EURJPY

136.63-137.05

USDJPY

120.39-85

EURGBP

0.7340-55

GBPUSD

1.5427-60

USDSGD

1.4075-1.4130

USDCHF
AUDUSD

0.9679-0.9703
0.7078-0.7136

USDTHB
USDKRW

36.00-07
1177.4-1182.5

NZDUSD

0.6279-0.6345

USDTWD

32.434-710

USDCAD

1.3226-57

USDCNH

6.4005-6.4140

AUDNZD

1.1210-52

XAU

1105.3-1109.7

Key Headlines
Quiet session ahead of FOMC and BOJ. There is
someone bidding decent amount of Euros at 1.1340. No
idea who but traders suspect Asian behind.
Japan Nikkei225 opened up positive but turned
negative weighed down by PM Abe, I meant cell phone
carriers.
Bipan Rais piece published today our economics
group sees a rate hike despite the protestations of
notable economists that the Fed should forgo raising
rates in the near-term. Bipan highlighted 5 important
signals - #1 the longer-run rate; #2 median dot
projections; #3 outlook on growth and inflation; #4
dissenters within statement; #5 how concerned is Fed
with international developments.

FX Flows
Overall market has been calm ahead of key events this
week BOJ and FOMC. Only interesting thing is EurUsd.
The pair kicked off 1.1338 and got up to 1.13595. On the
way back, our traders noticed very decent bids placed in
platforms at 1.1340. We suspect these bids are planted
after 6.30am HK this morning and mostly likely an
Asian behind. I heard bids also lined up 1.1310-20 and
sellers are mostly atop 1.1400.

As the AudUsd firmed up, UsdCad drifted lower. Most of

the offers are lined up above 1.3310 and we have little to
share on the downside, unless we get to mid-1.31s. My
colleague Sam mirrored the same thought on Cad
looking at bonds, he thinks Cad is cheap compared to the
Usd. Yield differentials between 2-year CAD bonds and
2-year UST, tells us UsdCad could see 1.3125.
From Bipan Rais piece published today our economics
group sees a rate hike despite the protestations of
notable economists that the Fed should forgo raising
rates in the near-term. Bipan highlighted 5 important
signals - #1 the longer-run rate; #2 median dot
projections; #3 outlook on growth and inflation; #4
dissenters within statement; #5 how concerned is Fed
with international developments.
Im not an expert for British politics but reading from the
press, Jeremy Corbyn winning the Labour Party
leadership should have some impact. The UK Telegraph
has a story that UKs biggest trade unions hailed
Corbyns election as Labour leader and threatened to
topple the Government using coordinated strikes and
demonstrations. Roger Bootle also put out a piece Corbyn said that a Labour government would introduce
peoples QE, that is to say, increased government
spending, perhaps on infrastructure, financed with
printed money. Some of PM Camerons key allies are
warning that Mr Corbyn and the movement he appears
to have inspired are an unknown quantity and must not
be underestimated.

Asians
In general, Greenback started weak versus the Asians but
regained in the late morning on profit taking.

Japan Nikkei225 opened up positive but turned negative

weighed down by cell phone carriers. According to a
story in Bloomberg, Japanese Prime Minister Shinzo Abe
told a meeting of the countrys Council on Economic and
Fiscal Policy that reducing the burden on households
from cell phone fees was an important issue to tackle.

As soon as traders settled down, UsdSgd sold off as

market reacted to the Singapore elections. US dollar
printed 1.4075 and buyers surfaced to take the UsdSgd
back to 1.41-handle. The focus is back on the MAS Semiannual Monetary Policy Statement in Oct. Global
Positioning Index shows that market is only small
fraction short Sgd.

Like the Nikkei, UsdJpy rose on the Tokyo open to

120.85 but fell back to 120.60s as the equity index
clawed back.

CNY fixed at 6.3709, in line with what market had

predicted. Weak Chinese data released over the weekend
puts pressure on the Shanghai Composite Index.

AudUsd seemed firm this morning despite the weekends

China data. General chatter of short covering in AudJpy
this morning. According to our trader Sam, interest rates
is telling us that the Aud looks cheap versus the Usd. If
the rates space is correct, we can see a bounce up to

Who said what

Reuters News: Shares of Softbank and other Japanese
telecom companies fell more than 5% after PM Abe
demands cell phone rates be lowered

These information have been obtained or derived from sources believed to be reliable, but I make no representation or warranty as to their accuracy or completeness.
Copyright 2013 The Poon Report by Vincent Poon. All rights reserved.

 South Korea Choi: South Korean exports in very

difficult situation
Japan PM Abe: Determined to pass defence bills this
session

News
WSJ: Chinas Battered Economy Could Surprise
Investors
An economy that isnt in full blown panic mode,
however, at least gives Beijing a fighting chance to effect
a change. The most recent interest-rate cuts, among
other actions, have yet to fully trickle through the
economy. It is possible Chinas growth model is just too
broken and the economy too debt laden to respond to
pump priming. But given how negative sentiment is on
China, even a modest recovery would be a surprise to
many.
http://www.wsj.com/articles/chinas-battered-economycould-surprise-investors-1442199517?
mod=wsj_nview_latest
WSJ: China Unveils Overhaul of Bloated State
Sector
Chinese President Xi Jinping set in motion the overhaul
of the countrys bloated state companies just ahead of his
U.S. visit, in a bid to show Beijing is committed to
change even as the economy slows. A plan released
Sunday, however, represents a modest fix to Chinas
brand of state capitalism. It attempts to enhance state
companies returns by letting them add private investors.
It also tries to improve state companies competitiveness
overseas by making them bigger, though that risks
creating more inefficiency and further stymieing private
enterprise.
http://www.wsj.com/articles/china-to-allow-stateowned-enterprises-to-sell-shares-to-public-1442138335
Telegraph: China economy: growth target in
doubt as investment and factory output stutters
Chinese investment grew at the slowest pace in 15 years
in the first eight months of 2015 as factory output
disappointed, raising fears that third quarter growth
would drop below 7pc for the first time since the
financial crisis. Fixed-asset investment, which covers
expenditure on a wide range of assets from plant and
machinery to infrastructure, expanded by 10.9pc in the
year to August.
http://www.telegraph.co.uk/finance/chinabusiness/11861747/China-economy-growth-target-indoubt-as-investment-and-factory-output-stutters.html
SCMP: Doubts over strategy of Chinas margin
lender in propping up stock values
The top stock picks of China Securities Finance
Corporation (CSFC) raise some doubts about whether it

put much thought into its investment strategy before

stepping in to shore up market values. The official
securities margin lender scrambled to buy stocks during
the market rout, including unpopular small-to-mid-caps
with poor fundamentals and high valuations. Some of
these companies had been selling assets for years to
avoid a delisting, while others have price-to-earnings
(P/E) ratios that top 1,000 when an ideal P/E is around
15 to 20.
http://www.scmp.com/business/markets/article/18579
25/doubts-over-strategy-chinas-margin-lenderpropping-stock-values
FT: Franklin Templeton suffers record outflows
Analysts are slicing their earnings forecasts for Franklin
Templeton, as the US asset management group wrestles
with some of the worst outflows from its mutual funds in
its history. Investors pulled more money from the
Templeton Global Bond fund, run by emerging markets
trader Michael Hasenstab, in August than in any
previous month, while Franklins global equities
business has now suffered 16 consecutive months of
outflows.
http://www.ft.com/intl/cms/s/0/942eaea4-58af-11e5a28b-50226830d644.html#axzz3lfQvBdbD
FT: Brazils terrible fall from economic grace
If Brazil was a hospital patient, emergency room doctors
would diagnose it as being in terminal decline. The
kidneys have packed up; the heart will go soon. That, at
any rate, is the damming opinion of a senator from the
Workers party, which has governed Brazil for 13 years,
overseeing both its rise on the global stage and now its
terrible fall.
http://www.ft.com/intl/cms/s/0/fa56a932-5875-11e5a28b-50226830d644.html#axzz3lfQvBdbD
Telegraph: Union bosses threaten to use Jeremy
Corbyn's victory to cripple UK
Union bosses yesterday threatened to use Jeremy
Corbyns victory to cripple Britain by holding a wave of
strikes and instigating civil unrest. The chiefs of the UKs
biggest trade unions hailed Mr Corbyns election as
Labour leader and threatened to topple the
Government
using
coordinated
strikes
and
demonstrations.
http://www.telegraph.co.uk/news/politics/Jeremy_Cor
byn/11862413/Union-bosses-threaten-to-use-JeremyCorbyns-victory-to-cripple-UK.html
Ambrose Evans-Pritchard in Telegraph: BIS
fears emerging market maelstrom as Fed
tightens
Debt ratios have reached extreme levels across all major
regions of the global economy, leaving the financial
system acutely vulnerable to monetary tightening by the

These information have been obtained or derived from sources believed to be reliable, but I make no representation or warranty as to their accuracy or completeness.
Copyright 2013 The Poon Report by Vincent Poon. All rights reserved.

US Federal Reserve, the world's top financial watchdog

has warned. The Bank for International Settlements said
the wild market ructions of recent weeks and capital
outflows from China are warning signs that the massive
build-up in credit is coming back to haunt, compounded
by worries that policymakers may be struggling to
control events. "We are not seeing isolated tremors, but
the release of pressure that has gradually accumulated
over the years along major fault lines," said Claudio
Borio, the bank's chief economist.
http://www.telegraph.co.uk/finance/economics/118589
52/BIS-fears-emerging-market-maelstrom-as-Fedtightens.html

These information have been obtained or derived from sources believed to be reliable, but I make no representation or warranty as to their accuracy or completeness.
Copyright 2013 The Poon Report by Vincent Poon. All rights reserved.