Morning Update – 13/04/2017 – by Arjun Lakhanpal

Morning all…Wall St closed down after Trump talked the dollar down, taking yields lower and and amidst another rise in geo-political tensions; the S&P closed down 0.38% but had been lower. The weak USD took Asia stocks lower and the Nikkei closed down 0.68% as USDJPY hit a low of 108.72. Since the lows were made we have seen a bounce as China data came in better than expected.. China March Trade Surplus came in at $23.93bn vs $10bn consensus; Exports +16.4% y/y vs +3.2% cons; Imports +20.3% y/y vs +18.0% cons; Q1 Trade Surplus: $49.6bn vs $50.57bn yr ago. This helping the global reflation argument. This has taken USDJPY back above 109.00. Elsewhere the AUD bounced on a surprisingly strong unemployment report.. Australia employment data reversed last month’s negative surprise with employment change +60.9k vs +20k expected and -6.4k print last month. Although unemployment rate remained at 5.9%, net jobs gains was a 16-month high at 60.9K while participation rate also rose to an 8-month high of 64.8% v 64.6%. AUDUSD drove higher throughout the session to a high just a few pips shy of 0.7600 and the weaker dollar helping. In a trifecta of central bank rate decisions, Brazil cut by 100bps to 11.25% as widely expected and said the accelerating pace of easing is appropriate with favourable trend of reduced inflation. Singapore central bank also preserved its SGD appreciation policy at zero and kept its inflation targets at 0.5-1.5% for this year. South Korea stood pat at 1.25% but raises its 2017 GDP and CPI forecasts by a decimal to 2.6% and 1.9% respectively, citing trend of improvement in exports and expectations of a rebound in consumption. South Korea did concede increasing uncertainty related to the threat from the North, just as analysts speculated that Pyongyang may be preparing to conduct its 6th nuclear test as soon as Apr 15th to commemorate the birthday of Kim Il-sung. This morning we get French and Italian CPI. geo-political risks remain a major concern.. Good luck.