Asian Session Forex Recap – August 19, 2016

  • NZ visitor arrivals up by 2.9% in July vs. -0.7% in June
  • NZ credit card spending up by 5.6% vs. 4.1% in June
  • Japan’s all industries activity up by 1.0% vs. 0.9% expected, -1.3% previous

A pretty calm day for Asian session forex traders, though a lack of economic releases inspired a bit of profit-taking among high-yielding currencies.

Major Events:

More Fed speeches – Dallas Fed President Robert Kaplan was under the spotlight a couple of hours ago, saying that he expects firm energy prices next year due to less supply. Too bad market players barely paid attention! If you recall, other FOMC members such as Williams and Dudley have also shared their hawkish sentiments. At the end of the day though, what matters is what the Fed’s Committee thinks as a group, which we’ve already seen from the not-so-hawkish FOMC meeting minutes.

Overall risk aversion – The Asian bourses started the day on a weak note, with Nikkei slipping on the back of the yen hitting its strongest levels against the dollar since November 2013. It also didn’t help that China’s equities as well as oil prices woke up on the red side of the charts.

Fortunately, bidders stepped up just before lunch break. Nikkei is up by 0.29%, Hang Seng is down by 0.34%, the Shanghai Index is down by 0.21%, and Australia’s ASX is up by 0.22%. Brent crude oil is also up by 0.31% to $51.05 while U.S. crude is up by 0.75% to $48.58.

Major Market Movers:

USD – The low-yielding Greenback gained back some of its weekly losses thanks to mild risk aversion in the forex markets.

EUR/USD is down by 33 pips (-0.29%) to 1.1333, GBP/USD is down by 31 pips (-0.24%) to 1.3139, and USD/JPY is up by 40 pips (+0.40%) to 100.35.

Comdolls – The low-yielding comdolls also bowed down to the dollar’s might despite a recovery in oil prices and better-than-expected economic releases from New Zealand.

AUD/USD is down by 61 pips (-0.79%) to .7632, USD/CAD popped up by 38 pips (+0.30%) to 1.2806, and NZD/USD is down by 38 pips (-0.52%) to .7254.

Watch Out For:

  • 6:00 am GMT: German PPI (0.1% expected, 0.4% previous)
  • 8:30 am GMT: U.K. public sector net borrowing (-2.3B EUR expected vs. 7.3B EUR previous)

See more:

U.S. Session Recap

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