Asian Session Forex Recap – Sept. 15, 2016

  • Chinese markets out on Mid-Autumn Festival holiday
  • AU MI inflation expectations rise by 3.3% vs. 3.5% previous
  • AU employment change at -3.9K vs. 15.2 expected, 26.2K previous
  • AU unemployment rate slips from 5.7% to 5.6% in August
  • AU new motor vehicle sales up by 0.1% vs. -1.4% previous

Risk aversion was the name of the game during the Asian session, as forex traders priced in weaker-than-expected data and central bank speculations.

Major Events:

Australia’s jobs reports – The Land Down Under printed its employment numbers today and the reports came in mixed. Unemployment rate slipped from 5.7% to 5.6% in August, the lowest since July 2013. However, a net of 3,900 had also lost jobs during the month when analysts had been expecting a net increase of 15,200. What’s up with that?!

Participation might have something to do with it. Labor force participation rate inched lower from 64.9% to 64.7%, suggesting that the drop in unemployment rate is likely due to job-seekers getting discouraged rather than more workers getting employed. Heck, even aggregate monthly hours worked showed decline for the month. On the plus side, full-time positions climbed by 11,500 though it wasn’t enough to offset the 15,400 decline in part-time work.

Overall risk aversion – With China’s markets out on holiday and barely any catalysts on tap, Asian session traders took their cues from their U.S. counterparts. The prospect of more easing from the BOJ weighed on Japanese markets while threats of more oil exports from Libya dampened the Black Crack’s rallies.

Nikkei is down by 1.27% while Hang Seng is up by 0.54% and Australia’s ASX inched 0.05% higher. Brent crude oil is also up by 0.52% to $46.09 while U.S. crude oil prices climbed up by 0.30% to $43.70.

Major Market Movers:

AUD – The Aussie took a step back against its counterparts as traders priced in weaker-than-expected employment and inflation expectation reports from Australia.

AUD/USD is down by 13 pips (-0.17%) to .7461, AUD/JPY is down by 31 pips (-0.41%) to 76.27, and EUR/AUD is up by 20 pips (+0.13%) to 1.5072.

JPY – Risk aversion pushed the low-yielding yen higher in the early part of the trading session before traders remembered that the BOJ might deepen its negative interest rate policy next week.

USD/JPY hit a low of 101.95 before closing at 102.24(-0.21%), EUR/JPY dropped to 114.64 before closing at 114.95 (-0.25%), and GBP/JPY slipped to 135.16 before closing at 135.57 (-0.04%).

Watch Out For:

  • 7:30 am GMT: SNB monetary policy decision
  • 8:30 am GMT: U.K. retail sales (-0.4% expected, 1.4% previous)
  • 9:00 am GMT: No changes expected from Euro Zone’s final CPI (0.2%) and core CPI (0.8%)
  • 9:00 am GMT: Euro Zone trade balance (22.1B expected, 23.4B previous)
  • 11:00 am GMT: BOE’s monetary policy decision (interest rate, asset purchases, forward guidance)

See also:

U.S. Session Recap
London Session Recap

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