Asian Session Forex Recap – Apr. 8, 2016

  • Japan’s current account surplus at 2.43T JPY vs. 1.57T JPY expected, 1.49T JPY in January
  • Fed member George calls for higher interest rates
  • Japan’s consumer confidence up from 40.1 to 41.7, higher than 40.5 expected
  • Japanese officials step up their jawboning

Asian session traders followed the footsteps of their U.S. session counterparts and continued selling higher-yielding currencies. Check out the winners and losers of the session!

Major Events:

Japan’s current account – The only economic data scheduled for release didn’t fail to inspire a bit of volatility during the session.

Japan clocked in a current account surplus of 2.43 trillion JPY in February, higher than the 1.57T JPY expected and January’s 1.49T JPY figure. It also marks the 20th surplus for the report and the highest pace of growth since March 2015. In case you missed our economic calendar cheat sheet, you should know that the current account report is just a measure of a country’s trade and financial flows. Think trade balance++.

More jawboning from Japan’s officials – What moved the yen more than the current account data was a bit of jawboning from several Japanese officials. Economy Minister Nobuteru Isahara, for example, suggested that the yen’s recent moves were likely based on speculations and warned that they’ll continue to “closely monitor the FX market.”

Finance Minister Taro Aso put fuel to the fire a few hours later when he said that they’re watching the currency moves “with a sense of urgency” and that they’ll “take necessary steps under certain circumstances.” This comes after he stepped up to the mike yesterday and said that the recent moves are “one-sided” and “undesirable.” Looks like they’re stepping up, huh?

Small recoveries for commodity prices– The comdoll gang got a reprieve from the overall risk aversion vibe after commodities like copper and oil recovered some of their losses from yesterday. Copper is up by 0.24% while gold ticked 0.03% higher. Meanwhile, Brent crude is up by 1.60% to $40.06 while U.S. oil is up by 2.12% to $38.05.

Major Currency Movers:

JPY – Whether it’s due the Japanese officials’ jawboning or end-of-week profit-taking, the yen traded lower against is major counterparts.

The closely-watched USD/JPY found support at 108.00 and popped up by 38 pips (+0.35%) while EUR/JPY also saw a 34-pip recovery (+0.28%). Meanwhile, GBP/JPY is 70 pips higher (+0.46%) and AUD/JPY closed 64 pips higher (+0.79%) than its open price.

Comdolls – The Aussie and Loonie gained a couple of pips against low-yielders like the dollar and yen, as a bit of recovery in commodity prices inspired end-of-week profit-taking.

AUD/USD is up by 34 pips (+0.45%) and USD/CAD is down by 43 pips (-0.33%) while AUD/JPY is up by 64 pips (+0.79%) and CAD/JPY is up by 58 pips (+0.70%).

Watch Out For:

  • 5:45 am GMT: Switzerland unemployment rate (3.5% expected vs. 3.4% previous)
  • 6:00 am GMT: Germany’s trade balance (19.2B EUR expected vs. 18.9B EUR previous)
  • 6:45 am GMT: France’s industrial production (-0.3% expected vs. 1.3% previous)
  • 7:15 am GMT: Switzerland’s CPI (0.3% expected vs. 0.2% previous)
  • 8:30 am GMT: U.K. manufacturing production (-0.2% expected vs. 0.7% previous)
  • 8:30 am GMT: U.K. industrial production (0.1% expected vs. 0.3% previous)
  • 8:30 am GMT: U.K. goods trade balance (expected to remain at -10.3B GBP)

See more:

U.S. Session Forex Recap

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