Ranges (Up till 11.

53am HKT)
Currency

Currency

EURUSD

1.1143-75

EURJPY

132.67-133.305

USDJPY

118.66-119.59

EURGBP

0.7335-55

GBPUSD

1.5168-1.5202

USDSGD

1.4224-60

USDCHF
AUDUSD

0.9709-31
0.6892-0.6949

USDTHB
USDKRW

35.955-36.02
1197.5-1204.7

NZDUSD

0.6266-0.6305

USDTWD

32.651-905

USDCAD

1.3250-84

USDCNH

6.4451-6.4675

AUDNZD

1.0999-1.1068

XAU

1118.8-1124.6

Key Headlines
Its all about China and market, including Nikkei
traders, kept close watch on A50 Futures then Shanghai
Composite.
It was non-event for G-20; PBOC Governor Zhou
Xiaochuan said that there is no foundation that RMB will
keep devaluing for a long term, Zhu Jun, DirectorGeneral PBOC international department, said volatility
in Chinas stock markets is nearing its end. So far,
Shanghai performance is proving the China Bashers
wrong.
Former Greek PM Tsipras has promised to fight to
improve the terms of Greece's latest bailout. But how?
Nouriel Roubini, ex-Dr Doom, dismissed market panic
over China as "manic depressive" behaviour by illinformed investors.

FX Flows
Calm start for Asia, US and Canada celebrate labour day
but market focussed on reopening of Chinese market.
The USDCNY fixed at 6.3584, touch lower but not a
surprise, given the remarks from PBOC Governor Zhou
Xiaochuan that there is no foundation that RMB will
keep devaluing for a long term.
All eyes on Chinese stock market. Initially, Nikkei
opened in red and this puts pressure on the UsdJpy.
However, when China A50 Futures started up firm,
Nikkei also reversed. UsdJpy printed 119.59 and backed
off as Shanghai Composite pared gains. UsdJpy offers
are touted above 119.70; most of the buying are scattered
below 118.30.
Slow session for Euro, we traded 1.1143-66 until Tokyo
open, shot up to 1.1175 on Eur-crosses short covering.
Echoes of EurUsd offers atop 1.1190, leftovers from last
Friday while profit taking at 1.1140. Former Greek PM
Tsipras has promised to fight to improve the terms of
Greece's latest bailout. How?

Not a lot to pen in the commodity currencies; AudJpy

was sold off initially after the official opening bell but the
AudUsd came back bid, probably some exporters bidding
below 0.6890.
The other topic being discussed today is whether Fed
ready to hike rates? Steve Beckner from MNI wrote that
Fed for the green light from G20 to raise rates. Irwin
Stelzer, in The Sunday Times, thinks Fed Res may opt for
a tiny rate hike. Weekends AFR said Fed will raise rates
unless there is another turmoil from China.

Asians
Another surprising piece by Ambrose Evans-Pritchard.
Usually a pessimist, AEP wrote Nouriel Roubini said the
alarmist reaction to the Shanghai stock market rout as
excessive, unreasonable and irrational, dismissing
market panic over China as "manic depressive"
behaviour by ill-informed investors. The famous Dr
Doom no more, said global markets have swung with
impetuous ferocity from complacency about Chinese
uber-growth to "extreme pessimism", suddenly
switching from talk of 7pc growth rates to 3pc or even
zero, when in reality little has changed.
Likewise, todays piece by Roger Bootle, emerging world
is not about to undergo a collapse. As I wrote last week,
there are signs of stabilisation in the Chinese economy
and the authorities there have plenty of room for
manoeuvre to take stimulatory policy action.
The USDCNY fixed today at 6.3584 versus last Weds fix
of 6.3619. Given the remarks from PBOC Governor Zhou
Xiaochuan that there is no foundation that RMB will
keep devaluing for a long term, market werent surprised
by the fix. Usd is bid across the Usd/Asia.
UsdMyr returns to 1998 AFC level. General chatter is
that the Ringgit weakness is linked to US jobless rate and
oil price. Market focusing on BNM rates decision on Sept
11 and Foreign Reserves on Sept 22.
Finally, UsdSgd is above the 1.4200-level and the pair
stayed bid. Buy order surrounding 1.4200-15 said to be
for macro names while some believe authority is keeping
close eye on the SgdMyr cross.

Who said what

Moodys: Japan slowing momentum threatens fiscal
consolidation
Moodys: Canada recession suggests more low growth
China NBS: Revises 2014 GDP growth to 7.3% from
7.4%
Indonesian Government: No nickel and bauxite
exports allowed in new stimulus policy package

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.

 Indonesia: To cut industrial gas prices to improve

economy

News & Data

Australia Aug AiG Perf of Construction Index 53.8
from 47.1
Australia Aug ANZ Job Ads rose 1% from -0.4%
WSJ: China Cuts 2014 Economic Growth to 7.3%
From 7.4%
China cut its 2014 economic growth figure to 7.3% from
7.4%, the countrys top statistics bureau said on Monday.
The National Bureau of Statistics said in a statement on
its website that after an initial check, gross domestic
product totaled 63.6 trillion yuan, or $10 trillion, down
32.4 billion from a preliminary estimate. China said the
figure is subject to further revision.
http://www.wsj.com/articles/china-cuts-2014economic-growth-to-7-3-from-7-4-1441593730?
mod=wsj_nview_latest
Shanghai Sec News: The China Financial Futures
Exchange announced it is raising
The China Financial Futures Exchange announced it is
raising margin requirements from 30% to 40% for nonhedging contracts, and from 10% to 20% for hedging
contracts, effective today. The Exchange also said that
for every one trading account, opening more than 10 lots
on a single stock index futures contract is considered
abnormal trading behavior. The previous threshold was
100 lots. The Exchange said the move is aimed at
curbing speculative activities in the stock index futures
market, which remain relatively strong despite past
tightening moves.
Roger Bootle in Telegraph: The Fed needs to
break us in gently with its first interest rate rise
now
Some judges have suggested that these factors should
persuade the Fed to stay its hand. I disagree. It would be
wrong, in my view, to allow monetary policy to be
dictated by movements in stock markets. It was partly
Fed chairman Alan Greenspans policy of being prepared
to reduce interest rates at the first sign of stock market
weakness that led to the inflation of asset prices and the
undervaluation of risk that caused the financial crisis of
2008-09. The world has still not yet fully recovered from
this mistake.
http://www.telegraph.co.uk/finance/comment/1184799
6/The-Fed-needs-to-break-us-in-gently-with-its-firstinterest-rate-rise-now.html
Steve Beckner in MNI Analysis: Fed Gets Green
Light To Raise Rates From G-20
Federal Reserve may not have needed it, but it got a kind
of green light to proceed with interest rate hikes over the

weekend at a meeting of Group of 20 finance ministers

and central bankers in Ankara, Turkey. G-20 economic
policymakers, including Treasury Secretary Jacob Lew
and Federal Reserve Vice Chairman Stanley Fischer,
acknowledged obliquely that Fed rate hikes are all but
inevitable and gave its implicit blessing.
https://mninews.marketnews.com/
FT: US shale oil industry hit by $30bn outflows
US shale producers reported a cash outflow of more than
$30bn in the first half of the year, in a sign of the
challenges facing the USs once-booming industry as the
slump in oil prices begins to take effect. The shortfall
points to a rise in bankruptcies and restructurings in the
US shale oil industry, which has expanded rapidly in the
past seven years but has never covered its capital
expenditure from its cash flow. The next hurdle facing
many US oil companies is the resetting of their
borrowing base: the valuation of their oil and gas
reserves that banks use to determine how much they will
lend.
http://www.ft.com/intl/cms/s/0/5a8c9a4c-54b0-11e58642-453585f2cfcd.html#axzz3kzDg6LaT
Ambrose Evans-Pritchard in Telegraph: Russia
flirts with Saudi Arabia as OPEC pain deepens
The OPEC oil cartel cannot withstand the pain of low
crude prices indefinitely and may be forced to abandon
its pugnacious bid for market share within months,
Russia's chief energy official has predicted. Arkady
Dvorkovich, the deputy prime minister, said OPEC
producers are suffering the ricochet effects of their
attempt to flush out rivals by flooding the world with
excess output.
http://www.telegraph.co.uk/finance/11847300/Russiaflirts-with-Saudi-Arabia-as-OPEC-pain-deepens.html
FT: Syrizas popularity wanes as key poll
approaches
Antigoni Kanelli says she voted for Greeces leftwing
Syriza party in January because she believed Alexis
Tsiprass promise to increase state pensions after five
years of cuts that slashed her monthly income by more
than one-third. Now pensions are once again being
reduced, this time to provide extra funds for the cashstrapped state healthcare service, while further cuts
loom next year as Greece implements a 86bn new
bailout programme agreed by Syriza with international
creditors.
http://www.ft.com/intl/cms/s/0/1af8d2b0-5488-11e5b029-b9d50a74fd14.html#axzz3kzDg6LaT
AFR: IEA says profits are a pipe dream for
$200b worth of Australian LNG projects

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.

Six liquefied natural gas projects under construction at a

cost of $200 billion will struggle to break even because
of the oil price slump, the International Energy Agency
said, and there is little prospect of three in the planning
stage going ahead. The agency said even if oil prices
recovered and averaged $US60 a barrel for the next few
years, Australia's LNG industry one of the world's
biggest will struggle to be profitable.
http://www.afr.com/business/energy/oil/lng-projectsface-breakeven-battle-20150905-gjg0r7
WSJ: Shadowed By Bailout He Agreed To,
Greeces Tsipras Pledges Easier Terms
Greeces former Prime Minister Alexis Tsipras pledged
on Sunday to continue fighting for better bailout terms
from the countrys international creditors, as opinion
polls show that his left-wing Syriza party is tied with
conservative rivals New Democracy two weeks before
Greeces snap elections. During his speech at
Thessalonikis annual international trade fair, the Syriza
leader said that the bailout deal Greece struck with
creditors in July leaves scope to substitute some harsh
fiscal measures with other policies that achieve the same
fiscal targets. The agreement, he said, is a text
deliberately open on certain issues and offers the
possibility of finding equivalent measures through
negotiation.
http://www.wsj.com/articles/greeces-tsipras-expectedto-unveil-election-manifesto-1441544052?
mod=wsj_nview_latest
WSJ: Chinas Central Bank Chief Predicts End
Nigh for Market Rout
Early this year, PBOC Governor Zhou Xiaochuan joined
a chorus of official voices talking up the nations stock
markets as a way to help the economy. Now, after an epic
bull run turned bust, Mr. Zhou is seeking to reassure the
investing public again, saying the rout in the markets is
nearing an end. In remarks to Group of 20, Mr. Zhou
said Saturday that the correction in the stock market is
almost done. Moreover, the Chinese yuan is steadying
after a devaluation last month, and that means Chinas
financial markets are expected to become more stable,
according to a statement posted on the website of the
Peoples Bank of China.
http://www.wsj.com/articles/chinas-central-bank-chiefpredicts-end-nigh-for-market-rout-1441543186

off parts of his ports and retail holdings in Hong Kong,

which is a conduit for Chinas international trade and
finance. Instead, the 87-year-old tycoon has pivoted his
two main conglomeratesHutchison Whampoa Ltd. and
Cheung Kong Holdings Ltd.toward the old world of
Europe.
http://www.wsj.com/articles/li-ka-shings-moves-inchina-reveal-good-timing-1441567980?
mod=wsj_nview_latest
FT: Malaysia scandal sparks dispute over
political funding reform
An official push for reform to political party funding in
Malaysia has deepened a dispute over how authorities
are dealing with the financial scandal engulfing Prime
Minister Najib Razak. A special committee, set up in the
wake of revelations that more than $675m landed from
overseas in Mr Najibs bank account shortly before the
last general election, is proposing to introduce landmark
campaign finance rules. Mr Najib denies wrongdoing.
http://www.ft.com/intl/cms/s/0/19a1bf72-5455-11e59497-c74c95a1a7b1.html#axzz3kzDg6LaT
Channel News Asia: New Thai constitution shot
down, spelling prolonged military rule
Thailand's junta-appointed reform council on Sunday
voted to reject a controversial new constitution, a result
that will prolong military rule and push back an election
to April 2017 at the earliest. Political parties,
nevertheless, cheered the decision by National Reform
Council (NRC) to dismiss the draft charter, having seen
it as an affront to democracy on various grounds,
including a provision that potentially allowed generals to
intervene in a "crisis".
http://www.channelnewsasia.com/news/asiapacific/ne
w-thai-constitution/2105948.html

WSJ: Li Ka-shings Moves in China Reveal Good

Timing
As investors around the world fret over Chinas
economic tremors, Hong Kong tycoon Li Ka-shing has
less reason to press the panic button: he has been quietly
accelerating moves to cut his reliance on the worlds
second-largest economy. Mr. Li has been trimming his
property portfolio in China since 2011. He has also sold
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.