Asian Session Forex Recap – June 30, 2015

  • Australian HIA new home sales down by 2.3% in May
  • New Zealand June ANZ business confidence slumped from 15.7 to -2.3
  • Japanese average cash earnings up 0.6% in May vs. 0.7% forecast
  • German retail sales and unemployment change data due
  • U.K. current account balance and final GDP reading up for release
  • Euro zone flash CPI readings and unemployment rate lined up
  • Greece’s 1.6 billion EUR payment to IMF due today

The comdolls woke up on the wrong side of the forex bed, as today’s Asian trading session kicked off with a bunch of weaker-than-expected reports. In Australia, HIA reported a 2.3% decline in new home sales for May after showing a 0.6% uptick in the previous month. Meanwhile, New Zealand’s ANZ business confidence index for June slumped from 15.7 to -2.3, reflecting pessimism among businessmen in the country.

AUD/USD is down 15 pips (-0.19%) after briefly testing resistance at .7700, NZD/USD is down 42 pips (-0.60%) and is hovering dangerously close to the .6800 mark, AUD/JPY is lower by 36 pips (-0.38%) and NZD/JPY is lower by 67 pips (-0.80%).

News that the Chinese central bank is still pumping up liquidity to the tune of 50 billion yuan in 7-day reverse repo agreements continued to weigh on the higher-yielders, leading investors to worry about the ongoing slump in the country’s equity market. In Japan, average cash earnings showed a 0.6% gain in May, lower than the projected 0.7% increase. The previous month’s reading was also downgraded from the initially reported 0.9% rise in wages to just 0.7%.

The Japanese yen still managed to advance against its forex rivals, as risk aversion seems to be driving price action in the past few hours. USD/JPY is down 20 pips (-0.16%), GBP/JPY is down 38 pips (-0.20%), and EUR/JPY is down 78 pips (-0.57%).

Euro pairs are mostly lower, with Greece moving closer to default-o-clock. Its 1.6 billion EUR repayment to the IMF is due today and so far there have been no signs of another lifeline from the ECB or its other creditors. The actual debt deadline is at 10:00 pm GMT so there could still be a few hours left to iron out an eleventh-hour deal, which means that forex traders will be paying close attention to news updates then.

Nonetheless, the upcoming top-tier reports might still be able to push European currencies around in the next few hours. Germany is set to release its retail sales and unemployment change figures, with consumer spending set to stay flat in May and hiring expected to pick up by 5K. The euro zone will also be printing its flash CPI and core CPI readings for June while the U.K. will release its current account balance and final GDP figure for Q1.

U.S. Session Recap

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