- Japanese retail sales +4.9%, YoY
- Japan’s unemployment rate rises to 5.1%, CPI -1.5%
- UK consumer confidence drops in May
- China’s industrial profits Jan-Apr +91.5% YoY
- Prudential bid for AIA in troubled waters, HK suspends Pru shares
- Regional sharemarkets gain 1.5% on average
Big moves overnight in NY led by short covering in the AUD and this pattern continued in Asia albeit to a much lesser extent.
AUD/USD closed in NY around .8515 and immediately fell as early Asian traders sold AUD/JPY and bought EUR/AUD but this trend reversed when more short covering emerged ahead of the long weekend in the US. Ranges: AUD/USD .8463/.8533, AUD/JPY 76.95/77.85, EUR/AUD 1.4440/1.4580.
EUR/USD closed in NY at 1.2370 but Asia has again been unable to generate any enthusiasm for buying the EUR and it has drifted lower against all other currencies. Ranges: EUR/USD 1.2281/1.2381, EUR/GBP .8446/94, EUR/JPY 111.92/112.73.
Cable has held up well despite the sell-off in the EUR/USD and dealers are still speculating that option hedges placed when the PRU/AIA deal was first agreed upon are now being unwound (and a tidy profit being booked). Large stops are seen below .8400 in the cross. Ranges: 1.4532/92.
USD/JPY again hasn’t reacted the economic data inside a 90.86/91.36 range.
Markets: Nikkei +1.7%, HK +1.6%, Sydney +1.5%, Kospi +0.7%. Gold $1212/oz, Oil $75.50/bbl.
