Morning Update – 06/09/2016 – by Arjun Lakhanpal

Morning all.. Wall St was closed yesterday so little for Asia to work on but stocks nudged higher as oil rallied, taking the Nikkei up 0.28% in a quiet session. AUD the G10 FX out-performer overnight, up half a percent, after the RBA remained unchanged as consensus had expected. Overall a very uneventful RBA meeting, though significant as it marks Governor Stevens’ last. Accompanying commentary showed very little notable changes from the previous statement. AUD out-performance is mainly due to the stronger current account data with a $4.5bn narrower deficit than widely expected in 2Q 2016, underpinned by favourable revisions to Australia’s net income position. Post the data release, many economists have revised higher their forecasts for Q2 GDP tomorrow to 0.5% q/q (from 0.3%), cons: 0.6%. This implies an annual rate of growth of +3.25% y/y – in line with the RBA’s recent forecast. The RBA left rates unchanged as expected. Abe advisor Hamada was on the wires and suggested the BoJ should wait for Fed at its upcoming Sept meeting. Price-action wise, the initial reaction taking USDJPY sharply lower by ~40 pips from the overnight highs at ~103.81; the pair later retraced some of this move and continued to hover around the 103.50/70 area throughout the rest of the session. UK Aug BRC Sales missed: -0.9% vs 1.4% consensus but GBP hardly moved.. This morning we get EU GDP for Q2 which is a final look at this data so unlikely to be far from expectations.. Good luck..