ForexLive Asia-Pacific FX news wrap: Massive Taiwan earthquake, magnitude 7.7

Taiwan earthquake:

• Earthquake near Taiwan Magnitude 7.5, felt in Taipei
• Reports of buildings collapsed in Taiwan after the 7.5 magnitude earthquake
• Philippines warns of tsunami and orders the evacuation of coastal areas after Taiwan quake
• TSMC evacuated factory areas after earthquake hit Taiwan
• Taiwan earthquake revised higher to magnitude 7.7, from 7.5
• Sea levels start to drop off the coast Okinawa ahead of a coming tsunami
• Taiwan authorities say the earthquake has caused 26 building to collapse

Other

• China’s Xiaomi begins deliveries of its first EV. Has booked more than 100,000 orders.
• China Caixin Services PMI for March 52.7 (expected 52.7, prior 52.5)
• Oil technical analysis and why you should care about this junction
• Bank of Japan continues to buy JGBs, amount unchanged from previous offer
• PBOC sets USD/ CNY mid-point today at 7.0949 (vs. estimate at 7.2282)
• Japan Jibun / S&P Global Services PMI 54.1 (preliminary was 54.9, prior 52.9)
• US Treasury Secretary Yellen is scheduled to visit China later this week
• Goldman Sachs US Q1 GDP Tracking now at 2.3%
• NATO meet Wednesday to discuss military support for Ukraine, 100 bn EUR proposal
• Reserve Bank of Australia monetary policy: current level of cash rate is … just right
• Invest in Mexico’s rise: Ride the bull with Mexican ETFs
• UBS forecast 3 Federal Reserve rate cuts in 2024, and another 5 cuts in 2025
• Biden and Xi speak for first time since November summit – US readout
• Oil traders heads up for the OPEC+ (monitoring) meeting coming up today
• Private survey of oil inventories shows smaller headline crude build than expected
• ICYMI – Mester and Daly both say 3 Fed rate cuts this year, but its not a promise
• US major indices sink but bounce off session lows. Russell 2000 leads the way lower
• Forexlive Americas FX news wrap: Treasury yields bust out but the dollar doesn’t follow
• Trade ideas thread – Wednesday, 3 April, insightful charts, technical analysis, ideas

Data
flow was limited during the timezone here today. The only item of
note was Caixin/S&P Global Services and Composite PMI for March.
The previous PMIs from China for March all improved, as did today’s
number.

The
bigger event was the Magnitude 7.7 earthquake just off the east coast
of Taiwan. This resulted in tsunami alerts being issued for Japan’s
Okinawa island chain (since withdrawn) as well as coastal areas of
Taiwan. The earthquake was the largest since 1999. Authorities
reported 26 buildings collapsed, there was one fatality and more than
50 injured.

For
markets the implications of the quake for chip production were an
issue. As I update the information on this is that the quake and
following aftershocks caused
TSMC and UMC to evacuate staff from some fabs in the Hsinchu and
Southern Taiwan Science Parks. The main semiconductor production
areas are to the west
of
the island,
where there are no reports of major damage as of now (see
screen shot below, the blue star is the epicentre).
The earthquake stopped some production lines at the Zhunan, Taiwan
fabs of TSMC and Powerchip, while plants run by chip testing giant
KYEC were evacuated.

For
major FX ranges were small only. It seems Asia FX is awaiting US
data, nonfarm payroll, due on Friday.

As
a heads up, China is out for the rest of this week, on holiday on
Thursday and Friday. Hong Kong is out on Thursday.

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