Ranges (Up till 11.

53am HKT)
Currency

option expiry strike at 0.6325 on Fri Sept 18, about

Nzd1.1bn.

Currency

EURUSD

1.12605-985

EURJPY

135.60-80

USDJPY

120.15-475

EURGBP

0.7348-60

GBPUSD

1.5336-55

USDSGD

1.3980-1.4030

USDCHF
AUDUSD

0.9716-48
0.7124-47

USDTHB
USDKRW

35.89-36.02
1177.5-1181.5

NZDUSD

0.6344-64

USDTWD

32.535-795

USDCAD

1.3234-53

USDCNH

6.4025-91

AUDNZD

1.1208-46

XAU

1104.3-1105.5

Key Headlines

Surprisingly that Nikkei about than 1% yet

UsdJpy traded to the left after Tokyo opened.

I spoke to our strategist Jeremy Stretch on UK

Labour Party leader Jeremy Corbyn and he said
the change in leadership will clearly create a lot
of headlines but without internal party discipline
their ability to move beyond just creating
headlines should not be overstated.

Sgd interest from Japanese is linked to M/A deal

involving Singapores Olam. Last month,
Mitsubishi Corp announced it will pay $654mio
in cash for new shares in the Singapore
commodity fund. They are paying S$2.75 a share
when market is currently at S$2.02.

FX Flows
A humdrum day as market waits for Fed. We thought
UsdJpy will head higher because of Wall Street and UST
yields but came off instead.
Surprisingly that Nikkei about than 1% yet UsdJpy
traded to the left after Tokyo opened. Market was in the
120.40s when I walked in and came off to 120.28
immediately after the opening bell. Chatter that the
sellers are not Japanese. Tokyo banks bought US dollars
at the fix, dont think it was a lot and some said it was
SgdJpy flow. Heard bids are placed near 119.95 and that
orders lined up at 120.60.
UsdJpy strike at 121.00 expires tomorrow, Sept 17 worth
$2.8bn.
EurUsd ran into offers above 1.1285 and hearsay
scattered up to 1.1300. Market spoke of bids at 1.1250
and stops thereafter.

Earlier today, our strategist Bipan posted this on

Canadian dollar that equities, bonds and crude were up
on the session which points to a disjointed market that is
uncertain about what to expect this Thursday from the
Fed. UsdCad levels were no different but the
combination of technical, positioning and seasonality
(September is generally a strong month for CAD) points
to a need for correction before the next leg higher. Daily
RSI is middling but not yet in bearish territory while the
trend line off July 29 lows remains intact. We continue
to like fading 1.3500 strikes for the time being as we see
better long-term value for USD buyers below the 1.30
mark.
UsdCad traded in a narrow range. Offers seen above
1.3260 and looks like some hidden buying at 1.3235.

Asians
After last Fridays Singapore elections, a lot of UsdSgd
positions have been closed out. Yesterday we saw one
Japanese bank forcing the UsdSgd down to 1.3989 right
at the Tokyo fix and today, same thing happened.
Apparently, the Sgd interest from Japanese is linked to
M/A deal involving Singapores Olam. Last month,
Mitsubishi Corp announced it will pay $654mio in cash
for new shares in the Singapore commodity fund.
It was into late morning, local banks appeared and took
UsdSgd back to 1.4000.
Malaysian market is closed today. The red shirts will
stage a pro-government rally today. Offshore NDF is
calm but speculators are keeping an eye on rally for there
is a chance this might get violent.
Bank of Thailand monetary policy today at 2.30pm
Bangkok. Rates are expected to stay unchanged at 1.5%

Who said what

Aussie and Kiwi sat on the side. Those who went long
AudNzd yesterday have puked as the cross got to 1.1208.
Im sure more pain if this goes below 1.1190. NzdUsd

RBA Debelle: China move to market-based RMB

should be welcomed
RBA Debelle: China public and private portfolio
allocation matters for financial markets
RBA Debelle: Government yield likely
structurally lover vs before
RBA Debelle: Shift in who is holding foreign
assets in China
RBA Debelle: Government bond yields still best
measure of risk-free yield
RBA Debelle: Bond market liquidity decline
desired outcome of regulation

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.

Brazil Levy: Government measures designed to

re-balance economy
Brazil Levy: Brazil must adapt to global
environment
Brazil Levy: CPMF would be a very small tax in
Brazil
Brazil Levy: CPMF is fair tax, is very easy for
Brazil to collect
Brazil Levy: CPMF tax wouldnt have big impact
on Brazilian inflation
Brazil Levy: CPMF tax needs to be temporary
Brazil Levy: Hitting inflation target is very
important
Brazil Levy: Brazil helping exports to grow
Brazil Levy: Civil construction key to stimulating
Brazil job growth
China MOFCOM: VW, Daimler and Bosch are
adding investments in China
HKMA Chan: Hkd peg is the best system for HK
HKMA Chan: No plan or intention to change the
peg system
China MOFCOM Shen: Yuan devaluation not
aimed at boosting exports

News & Data

New Zealand Q2 Current Account GDP Ratio

YTD -3.5% from -3.6% (est. -3.7%)
New Zealand Q2 BOP Current Account Balance
fell to Nzd1.216bn from +Nzd662mio (est.
-Nzd1.5bn)

Telegraph - Federal Reserve meeting: Will US

interest rates rise, and should they?
Just a month ago, the prospect of a US interest rate hike
seemed likely this September. The move would mark the
Federal Reserves first change in rates since the crisis.
September - and specifically this coming Thursday - was
expected to mark the moment that the Federal Funds
Rate yet again showed signs of life. Seven years on from
the crash, it has stood stagnant, at 0pc to 0.25pc. But
lift-off is expected to arrive soon. Investors believe the
central bank will make its move in December.
http://www.telegraph.co.uk/finance/economics/118670
64/Federal-Reserve-meeting-Will-US-interest-ratesrise-and-should-they.html
WSJ: North Koreas Nuclear Gambit
Critics of the Iran nuclear deal often point to Bill
Clintons nuclear accord with North Korea as a reference
point for what we can expect next, and this week we were
given a fresh lesson on that score. Satellite imagery
shows Pyongyang is reactivating its plutonium reactor at
Yongbyon, and now the regime has publicly threatened
to produce more bombs and test another long-range
ballistic missile.

http://www.wsj.com/articles/north-koreas-nucleargambit-1442359142
Rand Paul in WSJ: If Only the Fed Would Get
Out of the Way
Low interest rates may create an illusion of robust
markets, but eventually rates spike, assets are suddenly
revealed to be too highly priced, and debt unpayable.
U.S. stock market rose with each new wave of QE. Does
this wealth represent genuine economic progress? When
governments create a lie, whether its a fabricated
ecology of no fires or a fabricated economy of no failures,
the truth reveals itself even more violently than
otherwise. The sooner Fed officials withdraw their
artificial monetary injections and let interest rates rise to
their natural level set by free markets rather than
government decree, the sooner the economy can return
to genuine, sustainable growth.
http://www.wsj.com/articles/if-only-the-fed-would-getout-of-the-way-1442356924?mod=wsj_nview_latest
MNI ANALYSIS: Looming Fed Hike To
Complicate PBOC's Complications
Whether it's this week or later, the end is nigh for the
Federal Reserve's zero interest rate policy and that
threatens to complicate already challenging policy
conditions for the Chinese government. Nonetheless, the
potential for rising U.S. rates only complicates Beijing's
challenges, constraining the government's room for
maneuver even as the economy slows below this year's
target.
https://mninews.marketnews.com/
Greg Ip in WSJ: For the Fed, Markets May Be
Flashing a Wait Sign
As Fed policy makers ponder Wednesday and Thursday
whether and when to raise rates, an important factor in
their decision will be whether to wait to see if the recent
turmoil in stocks, bonds and currencies points to
unanticipated troubles in the global economy.
http://www.wsj.com/articles/for-the-fed-markets-maybe-flashing-a-wait-sign-1442332881
FT: Vicious cycle topples Australian leaders
On Monday it was Tony Abbotts turn. Just a few days
short of his second anniversary as prime minister, he lost
the Liberal party leadership to rival Malcolm Turnbull 54
to 44 votes. His ouster followed mounting discontent
with his governments policies and a run of bad polls. For
many Liberals his removal was an act of selfpreservation for the party ahead of a general election
next year. But it also raises questions about the vicious
nature of Australian politics. Australia has not had a
recession in nearly a quarter of a century, yet growth is
sluggish, unemployment is rising and our debt-to-gross
domestic product ratio is escalating. There is widespread

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.

discontent with Mr Abbotts performance at all levels in

the party. He broke election promises on health and
education reforms.
http://www.ft.com/intl/cms/s/0/bd3a2c2e-5b07-11e59846-de406ccb37f2.html#axzz3lfQvBdbD
FT: US lawmakers to vote on oil export curbs
US lawmakers will get to vote on whether to scrap
restrictions on oil exports as Republican leaders pledge
to make the issue a priority in Congress amid a glut of
American crude. The export controls date back to the
1970s and frustrate oil companies that have produced a
surfeit of US shale oil. Kevin McCarthy, the Republican
majority leader in the House of Representatives, said on
Tuesday that he would allow a vote on removing the
limits, due in the last week of September. But the
constraints are supported by many Democrats. The
White House says it would oppose repeal legislation,
leaving it with a slim chance of becoming law.
http://www.ft.com/intl/cms/s/0/396a9188-5beb-11e59846-de406ccb37f2.html#axzz3lfQvBdbD

Kathimerini: Greece Constantopoulou turns fire

on ex colleagues
Sundays elections are not about euro or drachma but
euro or democracy, former parliamentary speaker Zoe
Constantopoulou said on Tuesday as she addressed a
Popular Unity rally in central Athens, during which she
launched a fierce attack on the third bailout and her
former SYRIZA colleagues. Until recently one of Alexis
Tsiprass staunchest advocates, Constantopoulou
accused the previous government of betraying dreams
and handing over the new and next generations as
fodder for the Minotaur of the memorandum.
http://www.ekathimerini.com/201571/article/ekathimer
ini/news/constantopoulou-turns-fire-on-ex-colleagues

WSJ: U.S. Crude-Oil Stocks Expected to Increase

U.S. crude-oil stocks are expected to increase in data due
Wednesday from the Department of Energy, according
to a survey of analysts by The Wall Street Journal.
Estimates from 10 analysts surveyed showed that U.S. oil
inventories are projected to have increased by 1.1 million
barrels, on average, in the week ended Sept. 11. Three
analysts expect stockpiles to fall, while seven expect a
rise. Forecasts range from a rise of 3.4 million barrels to
a drop of 2.5 million barrels. The closely watched survey
from the Energy Information Administration is due at
10:30 a.m. EDT Wednesday.
http://www.wsj.com/articles/u-s-crude-oil-stocksexpected-to-increase-1442342250?
mod=wsj_nview_latest
FT: Global banks reach almost all 2019 capital
standards but still need another 147bn
The worlds top 200 banks still need another 147bn in
safe assets to meet new liquidity rules that come into
force in 2019, despite making significant progress in the
area in the second half of last year, a new report shows.
The update on banks progress towards the liquidity
coverage ratio (LCR) is revealed in the Basel Committee
of Banking Supervisions twice-yearly assessment of how
banks are preparing for new global regulatory demands.
European Banking Authority, the European Union-wide
group of banking regulators, carried out a parallel
exercise which included 53 of its largest globally active
banks and another 311 smaller banks. It found that there
was a 383bn shortfall of liquid assets among the
largest, Group 1 banks.
http://www.ft.com/intl/cms/s/0/419b7c12-5b98-11e5a28b-50226830d644.html#axzz3lfQvBdbD
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.