Market Overview
The Asia-Pac session was marked by a lack of excitement across major asset classes, with no significant catalysts to drive market movement. The session started slow and ended on a similar note, with markets failing to gain traction.
Key Developments
Several key developments took place during the session, including:
- China and Kazakhstan pledged to strengthen trade and cooperation ties.
- ING predicted that the weakness of the US dollar would pave the way for the EUR/USD to reach 1.20.
- The Russian central bank signaled flexibility on interest rates amid inflation risks.
- Implied volatility levels for GBP and EUR pairs were highlighted ahead of flash PMI data.
- Gold futures analysis was provided by tradeCompass for August 21, 2025.
- The UN chief called for a ceasefire in Gaza and urged Israel to halt settlement expansion.
- Meta froze AI hiring after rapid expansion and restructuring, according to the WSJ.
- The PBOC set the USD/CNY mid-point at 7.1287, compared to the estimated 7.1748.
- CME and FanDuel teamed up to offer event contracts for bets on financial markets.
- Nomura remained short on the US dollar ahead of the Jackson Hole symposium.
- Japan’s flash manufacturing PMI came in at 49.9, compared to the prior 48.9.
- The PBOC was expected to set the USD/CNY reference rate at 7.1748, according to Reuters.
- Nordea predicted downside for USD/NOK and upside for EUR/NOK.
- US Vice President Vance stated that Europe must carry the lion’s share of the security burden.
- China pushed for deeper cooperation with Pakistan and Afghanistan.
- Australia’s flash manufacturing PMI came in at 52.9, compared to the prior 51.3.
- New Zealand’s imports were reported at 7.28B, compared to the previous 6.5B.
- The economic calendar for the day ahead included flash PMI data for the EU, UK, and US, as well as claims data for the US.
Market Performance
The AUD was the weakest currency in the session, while the EUR led the pack as the strongest, closely followed by the GBP and USD. Among major indices, the ASX200 was up by 0.68%, while the Nikkei was down by 0.49%. US and EU indices saw minimal movement. Oil led the way among commodities, up 0.35% on the session, while gold gave up some of its gains from the previous day, down 0.26% on the session.
Looking Ahead
The focus shifts to the EU, UK, and US flash PMI data, as well as claims data for the US. The Jackson Hole symposium is also upcoming, with Powell’s speech being the main event. This is expected to provide more clarity on the future direction of monetary policy.
Conclusion
In conclusion, the Asia-Pac session was marked by a lack of excitement, with no significant catalysts to drive market movement. The session saw several key developments, including predictions of USD weakness and cooperation agreements between various countries. As the focus shifts to upcoming data releases and the Jackson Hole symposium, markets are likely to remain cautious, awaiting clearer direction on monetary policy and economic growth.
