Asian Session Forex Recap – Mar. 8, 2016

  • Japan current account down to 1.49T JPY vs. 1.66T expected, 1.59T previous
  • Japan’s GDP adjusted from -0.4% to -0.3% in Q4 2015
  • U.K. BRC retail sales monitor up by 0.1% in February vs. January’s 2.6% uptick
  • Australia’s NAB business confidence remains at 3 in February
  • China’s trade surplus misses at 210B CNY vs. 339B CNY surplus expected

Forex price action was a mixed bag of nuts, as traders priced in weak data from China and a bit of risk aversion in the markets.

Major Events:

China’s trade data – The world’s second largest economy spooked investors around the globe when it printed weaker-than-expected trade numbers. Its trade surplus came in at 210B CNY ($32.59B), lower than the expected 339B CNY ($50.15B) figure. Though some analysts point to the timing of the Lunar New Year as possible explanation for the steep declines, the details of the report were enough to make a lot of traders jittery.

Exports plunged by 25.4% from a year earlier, twice as much as analysts had expected and marked the steepest drop since May 2009. Imports weren’t any better with its 13.8% year-on-year decrease. On a monthly basis the lack of demand from both the domestic and international fronts dragged exports by 17.8% and pulled imports by 16.7%. Duhn duhn duhn duhn.

Oil slips from 2016 highs
– Black Crack traders saw China’s weak trade data as an excuse to take profits from their trades. Recall that oil has been enjoying nice rallies on the back of negotiations over possible output ceiling and freeze plans. This time oil prices slipped with U.S. crude down by 1.06% to $37.52 and Brent crude oil down by 1.20% to $40.35.

Major Currency Movers:

USD and JPY – The low-yielding currencies benefited from the overall risk aversion theme during the Asian session.

GBP/USD slipped by 10 pips (-0.07%), USD/JPY inched 6 pips lower, GBP/JPY fell by 18 pips (-0.11%), and AUD/JPY plunged by 44 pips (-0.52%).

Comdolls – Not surprisingly, the commodity-related currencies got hit hard by China’s weak trade data and a bit of oil price slide.

AUD/USD fell by 35 pips (-0.47%), USD/CAD popped up by 45 pips (+0.34%), and CAD/JPY slid by 32 pips (-0.38%).

Watch Out For:

  • 5:00 am GMT: Japan’s consumer confidence (42.3 expected vs. 42.5 previous)
  • 6:00 am GMT: Japan’s Economy Watchers Sentiment (47.5 expected vs. 46.6 previous)
  • 6:45 am GMT: Switzerland unemployment rate (expected to pop up from 3.4% to 3.5%)
  • 7:00 am GMT: German industrial production (0.6% expected vs. -1.2% previous)
  • 7:45 am GMT: French trade balance
  • 8:15 am GMT: Switzerland CPI
  • 9:15 am GMT: BOE’s Mark Carney to give a speech in London

See more:

U.S. Session Forex Recap

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