Asian Session Forex Recap – July 6, 2016

  • U.K. BRC shop price index down by 2.0% in June vs. 1.8% decline in May

Risk appetite took a turn during the Asian forex trading session despite the release of relatively better-than-expected economic reports. What’s up with that?!

Major Events:

More risk aversion – With no economic data to change the tides of market sentiment, most market players took the opportunity to catch up to yesterday’s bloodbath. That is, concerns over Britain’s property sector had a domino effect on the equities trading as well as the performance of higher-yielding currencies.

Nikkei took the most hits thanks to the yen’s sharp increase since the weekend. The index is down by 1.85% though Australia’s ASX is also down by 0.58%, Hang Seng is down by 1.84%, and the Shanghai composite is down by 0.07%.

Limited rallies in oil prices – Oil prices tried to extend their gains but buckled under the pressure of overall risk aversion and renewed oil oversupply concerns. Nigeria’s oil industry has started recovering from the recent militant attacks while the other major oil suppliers are showing no signs of slowdown in production.

Brent crude oil is only up by 0.13% to $48.03 while the U.S. crude is up by 0.09% to $46.64.

Major Market Movers:

GBP – The pound extended its trip down the charts as the Asian session traders piled on their shorts after yesterday’s selloff.

GBP/USD fell by another 120 pips (-0.91%), EUR/GBP popped up by 66 pips (+0.78%), and GBP/AUD slid by 93 pips (-1.24%).

JPY – The overall risk aversion boosted the yen for another day. USD/JPY is down by another 72 pips (-0.71%), EUR/JPY is down by 93 pips (-0.83%), and GBP/JPY is down by a whopping 212 pips (-1.60%).

Watch Out For:

  • 7:00 am GMT: German factory orders (1.0% expected vs. -2.0% previous)
  • 8:30 am GMT: RBA Assistant Governor Debelle to give a speech in Sydney
  • 9:00 am GMT: ECB’s Mario Draghi to give a speech in Frankfurt
  • 9:10 am GMT: Euro Zone retail PMI

See more:

U.S. Session Forex Recap

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