- Session dominated by end-of-month USD/JPY buying which has triggered stops above 95.55, 96.00 and 96.25.
- NZD falls on budget release.
- Australia Q1 new Capex -8.9%
- Regional stock markets generally flat and gold falls slightly on stronger USD
- Japan April retail sales -2.9% YoY
Flows are dominating the market at the moment. USD/JPY opened the session at 95.25 with all of the JPY crosses under pressure, EUR/JPY at 131.70 and GBP/JPY at 152.00. It has been one way traffic throughout the day however, with USD/JPY buying from corporate Japanese accounts triggering stops above 95.50 in early Tokyo and then relentlessly grinding higher with little or no pullback. EUR/USD was fairly quiet in a 1.3815/50 range for most of the session but the 1.3810 bids didn’t materialise as expected late in the session and trailing stops below there were triggered. This helped EUR/JPY ease off its 133.40 session high. The AUD and GBP were very quiet although there was some AUD/NZD buying seen after the NZ budget announcement.
There have been little or no announcements of major importance on the economic front. The OPEC meeting and the oil price, along with the Automotive industry and the futures of Fiat/Chrysler along with GM/Opel are the main stories being watched.
Orders: Asian central bank buying AUD/USD on dips. Strong bids in EUR/USD at 1.3740 and again 1.3680. Heavy stops above 133.75 in EUR/JPY. BIS/SNB bids expected in EUR/CHF around 1.5050.
Markets: Nikkei- flat. Sydney -1%, Kospi +0.3%. Gold -$2 at $948/oz. Oil steady at $62.
Ranges: EUR/USD 1.3792/1.3852, Cable 1.5900-80, AUD/USD .7742/.7814, USD/JPY 95.22/96.53, EUR/JPY 131.70/133.40, GBP/JPY 152/153.50.
