APAC Global Macro Morning Brief – Happy Macro Fri 29 Nov 2019: Different Day, Same Risk-Off View... APAC Global Macro Morning Brief – Happy Macro Fri 29 Nov 2019: Different Day, Same Risk-Off View... APAC Global Macro Morning Brief – Happy Macro Fri 29 Nov 2019: Different Day, Same Risk-Off View...

APAC Global Macro Morning Brief – Happy Macro Fri 29 Nov 2019: Different Day, Same Risk-Off View...

Macro 1 minute to read
Kay Van-Petersen

Global Macro Strategist

Summary:  Morning APAC Global Macro & Cross-Asset Snapshot

(Note that these are solely the views & opinions, they do not constitute any trade or investment advice of any kind.)

To see this wk’s Macro Monday click here

APAC Global Macro Morning Brief


Happy Macro Fri 29 Nov 2019: Different Day, Same Risk-Off View...


On yesterdays Macro Brief, KVP flagged why he thought we could be getting some tactical moves lower over the next few sessions given combination of Trump signing the bill, TG wkd (less liquid) & overall year-to-date gains (Amazing), plus general low vol environment

Time stop on this is likely by Mon or Tue next wk, unless we of course sell-off big time today. The US will be technically back in from the o/n public holiday, yet the big gals & boys will be home with their families & loved ones

Granted year-end to year-start hedges/protection, would allow quite a few of us to sleep better. It will be interesting if 2018 Dec/4Q = 2020 Jan/1Q

Upsides in DollarYuan 7.03 +0.22% & US bond futures 129-09 -0.07% continues to be some of KVP’s fav. for this potential near-term view, as is downside in the likes of DollarYen 109.51 -0.03%

Gold 1456 +0.13%, Silver 16.92 -0.262%  are also worth considering, as is general volatility

DollarYen 109.51, just looks strange at these lvls – i.e. how much upside is there here given the combination of UST are 1.76%, JGBs are off recent highs at -0.08% yields, where we are into year end / year start?

Also don’t forget the year-start lack of liquidity that the market experienced in DollarYen early this Jan 2019

IMHO it would take a lot for USDJPY to break out higher in a sustainable fashion, 109.69 & 109.86 are the 100 & 200 week moving average. 110 is also a psychologically important level in the markets

Yet think it would take  a lot less to see a reversal & DollarYen at sub 108. Bear in mind we were 106.28 just in Aug

We are still waiting for a “forceful” response from China. KVP continues to believe that the US & most people in the market, are discounting the signal that Trump signing the HK bills sends to China

In some ways it is way more visceral that trade tariffs, because here the US is telling the world’s second largest economy (15-16 trn vs. US’s 21-22 trn) what to do within its own borders. Imagine the US response if China passed a similar bill for say California?

Risks to KVP’s tactical near-term risk-off view is that for some reason we get a subdued response (i.e. KVP has it all wrong, China is desperate for a deal) and/or Trump somehow backtracks on the deal or offers concessions in other ways

Yet the thinking behind the tactical positioning here is from a  framework of, what does not cost me too much if I am wrong?...

…& then what would happen if I am right. What if they said… “who are we kidding, we know phase two & three are never gonna happen, why dance at all… all bets are off…”

Let see how the US session goes later on today, also don’t forget China official PMIs this wkd – so far the economy continues to decelerate in slow motion


Asia Fri Morning Open

US equity futures are down a touch at -0.10% (not they reversed overnight from their lows), whilst Asia equity futures are in the green

ASX 200 continues to do its thing +0.42% to 6901

Currencies largely unchanged, with the exception of USDKRW +0.15% at 1179


Gold & brent are flat at 1456 & 63.87, yet silver a touch bid at +.024% 16.96


Have a great wkd everyone, carve out some time for yourself & to do something for someone without them knowing 

KVP is shortly heading to our first parent-teacher event. Time flies, lets optimize it to the fullest




  • NZ: Building Consents -1.1%a +7.4%p
  • JP: Tokyo Core CPI Y/Y 0.6%e 0.5%p, Unemployment Rate 2.4%e/p (yes two point four percent), Flash IP
  • EZ: GER U/R, Flash CPI 0.8%e 0.7%p, CORE 1.2%e 1.1%p, EZ U/R
  • CA: Monthly GDP, Industrial Production

    Week Ahead:

  • Rate decisions out of Australia (Tue), Canada (Wed) & India (Thu)
    • As we’ve flagged before Poloz will almost certainly be on the sidelines despite previous BoC meeting, RBA could surprise with a cut despite recent comments from Lowe & we know the RBI are on a dovish skew
  • Data wise it will be a massive wk with ISMs, Final PMIs & Super Friday USA (NFPs, AHE, etc), plus we’ll also have 3Q GDP due out of Aus
  • Also do check out our 2nd last Macro Monday, on…. That’s right… Monday



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