ForexLive Asia-Pacific FX news wrap: Subdued FX ranges ahead of the FOMC

[Forex News]

• PBoC official says there is a solid foundation to keep yuan exchange rate basically stable
• UK CPI data is due Wednesday, 20 September 2023 - danger of higher than expected?
• China's NDRC Vice Chair: macro polices effective, still challenges, striving to hit target
• Fed 'insider' Timiraos previews the FOMC meeting, rates and peak forecast to be unchanged
• Guilty plea on charges of misappropriating funds from investors promised big crypto return
• PBOC sets USD/ CNY mid-point today at 7.1732 (vs. estimate at 7.2926)
• PBOC Loan Prime Rates (LPR) remain unchanged at today's rate setting, as expected
• Australian data - Westpac Leading Index for August -0.04% m/m (prior +0.01%)
• A single oil trading firm sparking price run-up for U.S. physical crude (Bloomberg report)
• Japan's August exports and imports both fell y/y, not as much as expected
• Shanghai Securities News says the PBOC has space to further cut the RRR this year
• Japan's Kanda (yen intervention guy) says closely communicating with US re FX moves
• New Zealand data, current account beats estimates
• UBS on Brent oil - strong fundamentals to support a $90–100/bbl range in coming months
• Japan's PM Kishida to allow overseas asset management firms' entry to domestic market
• US Treasury Secretary Yellen warns over potential yen intervention
• Magnitude 5.7 earthquake hits South Island region of New Zealand
• JP Morgan says price of oil could rise to US $120 because supply cuts may not be over
• South Korea wholesale level inflation surging again, biggest jump since April 2022
• Forexlive Americas FX news wrap 19 Sep: One more sleep until the FOMC decision.
• Wall Street Journal: The Fed’s Next Challenge: $100 Oil
• Oil - private survey of inventory shows much larger draw than was expected
• US major indices close lower but it could've been worse

Onceagain major forex rates traded in limited ranges ahead of a bigWednesday coming up with:

• UKinflation data,
• theFederal Open Market Committee (FOMC) statement,
• andFederal Reserve Chair Powell’s news conference.

Theearly part of the session brought comments from US Treasury SecretaryYellen on how the US views potential intervention on the yen. USD/JPYdribbled a little lower on the remarks. These were soon followed byintervention-related comments from Japan's Finance Ministry's ViceFinance Minister for International Affairs Kanda, often referred toas Japan's 'top currency diplomat'. USD/JPY lost a further fewpoints. As the headline to this post says, though, ranges werelimited and that applied to USD/JPY.

Datafrom Japan today showed exports fell for the second consecutivemonth.

Thescheduled event of the session was the People's Bank of China policyrate setting. Loan Prime Rates (LPR) remain unchanged at today's ratesetting, as expected:

• 3.45%for the one year
• 4.20%for the five year.

AsI post a news conference attended by representatives from thePeople's Bank of China, the National Development and ReformCommission of the People's Republic of China (NDRC), the Ministry ofFinance, and the Ministry of Industry and Information Technology isunderway. So far there have been plenty of comments but nothing outof the ordinary. See bullets above. Zou Lan, head of the monetarypolicy department at the People's Bank of China (PBOC), did emphasizethat:

• "Peopleusually discuss more about thee exchange rate of the yuan against thedollar, but in fact, the exchange rate of the yuan against a basketof currencies can more comprehensively reflect the changes in thevalue of the currency".

Priorto this, the Bank set the USD/CNY reference rate at its lowest sinceAugust 14.

Asianequity markets followed on from a weak Wall Street lead:

• Japan’s Nikkei 225 -0.36%
  
• China’s Shanghai Composite -0.38%
  
• Hong Kong’s Hang Seng -0.5%
  
• South Korea’s KOSPI -0.1%
  
• Australia’s S&P/ASX 200 -0.6%
  

Offshore yuan update:

This article was written by Eamonn Sheridan at www.forexlive.com.

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