· Yuan stands tall on China recovery, RBA weighs on Aussie
The yuan held near a two-year high against the dollar in offshore trade on Tuesday, on signs of China’s robust economic recovery while the Australian dollar slipped to a three-week low as the central bank looks set to enhance monetary easing.
Broader risk sentiment was curbed by caution ahead of a Tuesday deadline to reach agreement on a U.S. coronavirus aid package as well as the Nov. 3 U.S. presidential election.
China's offshore yuan rose as high as 6.6695 per dollar on Monday, surpassing its 2019 peak and hitting its strongest level since July 2018. It last stood flat at 6.6806 CNH=.
The yuan’s gain came as data on Monday showing a recovery in China’s consumer sector helped boost not only the Chinese currency but others, including the euro.
On the other hand, the Australian dollar dropped 0.3% to $0.7045 AUD=D4, hitting a three-week low of $0.7038 on increasing expectations of monetary easing next month by the country's central bank.
Minutes of the Reserve Bank of Australia’s (RBA) last policy meeting confirmed the Board had discussed cutting rates and buying longer-dated debt as a means to support the economy and restrain the currency.
U.S. House of Representatives Speaker Nancy Pelosi and Treasury Secretary Steve Mnuchin “continued to narrow their differences” in a telephone conversation on Monday, her spokesman said.
Pelosi hopes that by the end of Tuesday there will be “clarity” on whether a coronavirus stimulus bill can be passed before the Nov. 3 presidential election, he said.
In Asian trade, the euro held flat at $1.1767 EUR=, after a 0.44% gain made on Monday.
Sterling also held on to small gains made the previous day at $1.2941 GBP=D4.
Britain’s chief Brexit negotiator David Frost said there was no basis to resume trade talks with the European Union unless there was a fundamental change in Brussels’ approach to negotiations.
· Treasury yields move higher as investors monitor economic data, auctions and Fed speeches
U.S. government debt prices were lower on Tuesday morning, as investors closely monitored the potential for a new coronavirus stimulus package ahead of next month’s presidential election.
At around 2:55 a.m. ET, the yield on the benchmark 10-year Treasury note was higher at 0.7640%, while the yield on the 30-year Treasury bond was also higher at 1.5529%. Yields move inversely to prices.
On the data front, housing starts for September and building permits for September will both be released at 8:30 a.m. ET, with Philly Fed non-manufacturing data for October set to follow slightly later in the session.
The U.S. Treasury is set to auction $30 billion of 119-day bills and $30 billion of 42-day bills on Tuesday.
Meanwhile, Fed Vice Chair Randal Quarles, Chicago Fed President Charles Evans, Fed Governor Lael Brainard and Atlanta Fed President Raphael Bostic are all scheduled to comment on the world’s largest economy during separate online events.
· Doctor: US clearly in a 'third wave' of coronavirus infections as COVID-19 fatigue sets in
Rising coronavirus diagnoses across the U.S. aren’t a good sign as major parts of the country grapple with surges in new COVID-19 counts ahead of the flu season.
“We’re clearly in a third wave if we’re looking at the true overall case counts in the country, realizing that our baseline has gotten higher and higher,” Dr. Dara Kass, an emergency medicine physician at Columbia University and a Yahoo contributor. “So as we head into this third wave over the country, we’re still now 40,000 to 50,000 cases a day.”
· Trump says he will participate in debate with Biden, but thinks it is unfair
· U.S.-China tensions could split the internet — and data will play a key role in how far that goes
Political tensions between the U.S. and China have thrust technology and supply chains into the spotlight and threaten to fracture the internet.
· China keeps lending benchmark loan prime rate steady for 6th straight month as expected
China kept its benchmark lending rate for corporate and household loans steady for the sixth straight month at its October fixing on Tuesday, encouraged by an extended recovery in the world’s second-largest economy from the coronavirus shock.
The one-year loan prime rate (LPR) was kept unchanged at 3.85%, while the five-year LPR remained at 4.65% — as widely expected by the market.
· Indonesia to provide COVID-19 vaccine to 9.1 mln people at 1st phase
Indonesia will at the first phase provide the COVID-19 vaccine to 9.1 million people between November and December 2020, the Health Ministry's Disease Control and Prevention Director General Achmad Yurianto said.
The first phase of vaccination will be carried out on the groups of people with highest risk of COVID-19 infections, namely medical and public service workers including airport employees, soldiers and police personnel, Xinhua news agency reported on Monday.
· Thailand suspends TV station over protests coverage
A Thai court on Tuesday ordered the suspension of an online TV station critical of the government, which has accused it of violating emergency measures aimed at ending three months of protests.
Voice TV had also been found to have breached the Computer Crime Act by uploading “false information,” digital ministry spokesman Putchapong Nodthaisong told reporters.
Thailand has drawn criticism from rights groups for banning demonstrations and the publication of news seen as damaging by the government as it tries to end the protests against Prime Minister Prayuth Chan-ocha and the powerful monarchy.
Rittikorn Mahakhachabhorn, Editor-in-Chief of Voice TV, said it would continue broadcasting until the court order arrived.
· Oil prices steady but rising infections and oil supply weigh
Oil prices were little changed on Tuesday, steadying after three days of declines due to worries that a resurgence of coronavirus cases globally is stifling a recovery in fuel demand, while growing output from Libya adds to plentiful supply.
Brent crude LCOc1 futures were trading down 4 cents, or 0.1%, at $42.58 a barrel by 0635 GMT, recovering ground after falling to as low as $42.19 earlier in the session.
U.S. West Texas Intermediate (WTI) crude CLc1 futures edged up 1 cent to $40.84 a barrel, having earlier dropped to $40.48.
Reference: Reuters, CNBC, Yahoo Finance
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