Forex trading headlines for Asia Wednesday 16 April 2014
- US Treasury semiannual currency report: No country met standard to be called currency manipulators
- New Zealand – Dairy prices fall another 2.6%
- New Zealand CPI for Q1: +0.3% q/q (vs. expected +0.5%)
- Federal Reserve’s Kocherlakota: Inflation is well below Fed’s goal and more from him here
- China’s March power consumption up 7.2% y/y
- Bank of Japan (BOJ) Governor Kuroda says easing is having intended effect and more from Kuroda here and here
- Japan finance minister Aso: Drop in demand after sales tax hike seems less than expected and more from Aso here, and here
- Australia – Westpac/Melbourne Institute (MI) Leading Index for March: 0.0% m/m (prior was -0.1%)
- MNI China business indicator at 51.1 in April (vs 53.4 March)
- All the China data – GDP, Industrial production, retail sales and more
- Japan chief cabinet secretary Suga: Japan’s economy starting to improve on domestic demand
- More comments from China NBS on exports, trade and property market
The early part of the session was all kiwi – with a good news day for kiwi bears; lower dairy prices in the overnight then a very soft CPI data point (see bullets, above). The NZD/USD was marked down on the CPI release to 0.8600 and just below, before recovering to its 0.8630 break point (give or take a few tics) and then losing all of the recovery to trade back below 0.8600. The CPI print was softer than expected, the details even more so and market perception was that while it still seems overwhelmingly likely there will be a rate hike from the RBNZ on the 24th, pressure has eased a little on the pace of coming future hikes. Whether that is the case remains to be seen, but a day for the bears today nonetheless.
The wait then began for the Chinese data. AUD/USD had not done much at all, falling a little as the NZD drifted lower, but not getting lower than overnight lows to any extent really, supported around 0.9330. The headline China GDP data came in a tick above expectations (see bullets, above), sending the AUD 30-odd points higher before it settled around 0.9350/55 (as of writing).
USD/JPY benefitted from a better performing Nikkei on the day; GPIF talk doing it no harm, and it didn’t mind the headline China GDP beat as well. Sellers ahead of 102 were (finally!) all filled in, with USD/JPY pushing to about 102.07 only before more sellers held it in check yet again. It stabilised above 102 and then pushed to around 102.15 after an hour or so, then to around 102.20 where it settled.
And a big hello to EUR, GBP and CHF. Here’s the deal, you move and I’ll write a kind word or two about you, but if you are just gonna lie there and play dead in a minuscule range you can just go and get