Asian Session Recap – Sept. 11, 2014

  • RBNZ kept interest rates on hold at 3.50% as expected
  • Chinese CPI down from 2.3% to 2.0% vs. 2.2% estimate
  • Australian employment change showed 121K gain, higher than 15.2K forecast
  • Australia’s jobless rate down from 6.4% to 6.1%, participation rate up
  • U.S. President Obama authorizes more airstrikes against ISIS
  • French and German CPI figures due

And the Greenback is at it again! A fresh wave of risk aversion gave the U.S. currency a boost in today’s Asian trading session, pushing USD/JPY to a high of 107.05 and EUR/USD back below the 1.2900 mark. GBP/USD is still struggling to hold on to the 1.6200 mark while AUD/USD got a bit of support from the Australian jobs release.

Employment in the Land Down Under picked up by an impressive 121K in August, higher than the estimated 15.2K reading, yet the July figure was downgraded from -0.3K to -4.1K. Despite that, the jobless rate improved from 6.4% to 6.1%, even with a small uptick in the participation rate. However, Chinese CPI came in weaker than expected at 2.0% versus the projected 2.2% reading, reminding forex traders that weakness in the world’s second largest economy could weigh on Australia’s trade performance.

Meanwhile, the RBNZ’s decision to keep interest rates unchanged at 3.50% for much longer appears to be bothering the Kiwi, as central bankers also stressed that the New Zealand currency is still overvalued. NZD/USD has dipped to a low of .8186 in the past few hours while NZD/JPY appears to have broken below the 87.50 minor psychological support.

Data is light in the upcoming London forex trading session, with only the French and German CPI figures on tap. Lower than expected readings could drag the euro down, as these would remind traders that deflation remains a threat in the euro zone. Apart from that, risk appetite seems a tad weaker now that U.S. President Obama has authorized another set of airstrikes against ISIS and this might bring geopolitical risks back on the table.

U.S. Session Recap

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