Asian Session Recap – July 15, 2014

  • China posted better than expected new loans and money supply data
  • Australia’s new motor vehicle sales up by 1.7% in June
  • U.K. BRC retail sales monitor down by 0.8% from previous 0.5% increase
  • BOJ kept monetary policy unchanged for the time being
  • RBA minutes: Period of stability in interest rates will be maintained
  • U.K. headline CPI to climb from 1.5% to 1.6%?
  • German and euro zone ZEW economic sentiment figures due

Yen pairs edged slightly higher in today’s Asian trading session in anticipation of dovish remarks from the BOJ. However, the Japanese central bank decided to keep monetary policy unchanged for the time being, even with the latest round of weak economic data from Japan. Policymakers reiterated that they are seeing moderate economic recovery and that the effect of the April sales tax hike will soon subside.

USD/JPY held on to its recent gains above the 101.50 minor psychological level while EUR/JPY stayed inside its range somewhere between 138.25 and 138.40. AUD/JPY was able to climb to a high of 95.48 and GBP/JPY struggled to hold on to the 173.50 handle.

The Australian dollar got a bit of a boost when the new motor vehicle sales report printed a 1.7% gain and China churned out stronger than expected data on new loans and money supply. The Aussie was forced to return some of these recent wins though, as the RBA minutes emphasized its plan to maintain a period of stability in interest rates. In other words, don’t count on an RBA rate hike anytime soon!

In the next few hours, the pound could take center stage as the U.K. will release its CPI figures. The headline and core CPI are slated to show gains, and this might lead to a return of pound bulls as traders start buzzing about rate hike expectations once more. Also lined up for today is the release of Germany’s and the euro zone’s ZEW economic sentiment figures. Germany is expected to report a dip in economic sentiment yet analysts are expecting to see improved figures for the entire euro region.

See also:

U.S. Session Recap

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