Forex news for Asia trading for Wednesday 21 April 2021

USD/JPY dropped under 108 again here today (it did so briefly yesterday also) before rebounding (a smaller rebound this time as I post) and subsequently dropped under 108 again (and is still under as I update). Chatter of a battle of flows, bidders said to be macro-fund interests while shorter-term spec were the sellers. Its been a small range only (20 points or so) but with a few laps between the session high and low. Net for the session yen crosses are a touch lower.

Elsewhere the USD has gained a little; AUD, EUR, NZD, GBP are all a touch weaker (again only in small ranges). Australian March retail sales (preliminary) showed a m/m bounce (and beat of expectations) but the y/y result was underwhelming. New Zealand headline Q1 inflation data came in higher than the previous quarter and in line with expectations. There is still a 'core' inflation reading to come from NZ today, the Reserve Bank of New Zealand's 'Sectoral Factor Model Inflation Gauge'.

In US news, huge consumer products company Proctor & Gamble said they were set to raise prices on a range of products from (northern) Autumn (Fall). This may attract the attention of Federal Reserve officials who have repeatedly said they expected inflation to be transient. It would be unusual indeed for a major firm such as P&G to raise prices if they believed rising input costs were transient only. It would also be unusual for such a major firm to reverse price rises soon after hiking them. In other US news, the (now ex) police officer accused of killing George Floyd was found guilty of all murder/manslaughter charges that he faced.

The probability of further coronavirus-related state of emergency declarations in Japan firmed again today.

The People's Bank of China set the mid-rate for USD/CNY lower again today (i.e. stronger for onshore yuan).

Regional equities:

  • Japan's Nikkei -2.2%, Topix -2.2%

  • China's Shanghai Composite -0.8%

  • Hong Kong's Hang Seng -1.6%

  • Australia's S&P/ASX 200 -1.4%

Forex news for Asia tradingfor Wednesday21April 2021