- Latest RBA minutes suggest a continued pause unless inflation data changes unexpectedly, which they don’t envisage
- Heavy demand for USD/JPY and the JPY crosses at the Tokyo fix drive prices higher
- Disappointing revenue estimates from IBM and Texas Instruments send technology shares lower in the US after hours markets
- Asian markets fall early but rebound strongly on leads out of China and HK
- China to limit trade in new index futures
- RBA Governor remains optimistic on Australian growth but wary of global uncertainty
It has been a busy session in Asia driven by large volumes at the Tokyo Fix where strong demand for USD/JPY in particular drove risk-trades higher.
USD/JPY closed in NY at 86.80 but reports that both the BoJ and Kampo were seen buying on dips set the tone for the local session. The first move was down, led by the technology stocks results, but this didn’t last and eventually the bearish sentiment was undone by sheer volume of buying. Ranges: 86.70/87.18, EUR/JPY 112.15/113.04
EUR/USD has gradually moved higher along with EUR/JPY demand and EUR/CHF has also sneaked higher as risk-trades were back in vogue. Ranges: 1.2927/73, EUR/CHF 1.3638/71
EUR/GBP has traded in a tight range around .8500 leaving the cable to follow in step with the EUR/USD. Ranges: 1.5214/69, .8495/.8508.
The AUD has been very busy. AUD/USD fell first with the tech stock results but rallied strongly thereafter with strong AUD/JPY demand at the fix driving that pair higher. The RBA minutes slowed the rally for a while but once traders digested the comments, the short covering resumed. Ranges: .8669/.8785, AUD/JPY 75.10/76.60
Markets: Nikkei -0.6%, HK +1.4%, Shanghai +1.6%, All Ords +1.1%, Kospi +0.4%. Gold $1182/oz, oil $76.50/bbl.
