Forex Today: Chinese GDP Growth Slows

Official Chinese GDP data shows growth has slowed over the past quarter, knocking the Hang Seng Index slightly.



  1. Official Chinese data for the past quarter shows that GDP growth has slowed in annualized terms from 3.9% to 2.9%, low in historical terms but higher than the 1.6% which had been widely expected. This has slightly set back the Chinese stock market, but the selling so far has been nothing notable.
  2. The yield on Japan’s 10-year bond has again exceeded to the ceiling imposed by the Bank of Japan. This, along with signs of accelerating inflation in Japan, is raising expectations that the Bank of Japan may take a more hawkish approach in its monthly policy meeting scheduled for tomorrow, which is turn is leading to expectations that the Yen will continue to trend higher. However, the benchmark USD/JPY currency pair, while still in an obvious long-term bearish trend, has risen over the past couple of days, although the move has been nothing out of the ordinary.
  3. In the Forex market, the US Dollar made some minor gains yesterday, but the movement was small, and markets were quiet, due to the public holiday in the USA.
  4. The long-term bullish trend in precious metals continues, with the price of spot Gold rising to an 8-month high above $1928 early Monday before pulling back. The price of spot Silver is also bullish, but less so. These assets are attractive to long-term trend traders in the long direction right now, as higher prices here are likely over the coming days.
  5. There will be releases today of Canadian CPI data, the US Empire State Manufacturing Index, and British unemployment data.
  6. Daily confirmed new global coronavirus cases decreased last week for the fourth consecutive week, but there are serious doubts over the veracity of China’s official statistics, which almost certainly dramatically understate new coronavirus cases.
  7. Total confirmed new coronavirus cases worldwide stand at over 671.6 million with an average case fatality rate of 1.00%. 
  8. The rate of new coronavirus infections appears to now be significantly increasing only in Japan and China.
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