Asian Session Forex Recap – Nov. 2, 2016

  • Japan’s monetary base slips from 22.7% to 22.1%
  • U.K. BRC shop price index (y/y) drops by 1.7% vs. 1.8% decline in September
  • AU building approvals drops by 8.7% vs. 2.8% slip expected, 1.8% decrease in August
  • NZ quarterly inflation expectations remains at 1.7%
  • Japan’s consumer confidence falls from 43.0 to 42.3 vs. 42.8 expected

The dollar continued to bleed pips against its major counterparts, as Asian session forex traders caught up to the bloodbath seen in the previous trading sessions.

Major Events:

AU building approvals miss – Dwelling approvals declined by 8.7% for the month of September, much more than the 2.8% slip that market players were expecting. A closer look tells us that, while approvals for new houses rose by 2.3%, apartment and town house approvals had fallen by 16.2%.

Overall the numbers support speculations that the approvals has reached the top of a cycle but that its current levels are still higher compared to historic norms, which still points to more construction activity ahead.

Overall risk aversion – Asian bourses all fell in the red today thanks to jitters over the upcoming Fed and NFP reports and this weekend’s U.S. Presidential elections. Word on the hood is that Trump is gaining ground against Clinton, which spells uncertainty for the global markets.

Australia’s ASX 200 is down by 1.16%, Hang Seng is down by 1.40%, the Shanghai index is down by 0.35%, and Nikkei is down by 1.76%.

Slide in crude oil prices – Oil prices also joined the risk aversion band wagon especially after yesterday’s API report reflected a surprise oil inventory build. Brent crude oil is down by 0.71% to $47.80 while U.S. crude oil prices is also down by 0.81% to $46.29.

Major Market Movers:

USD – The dollar lost more pips against its major counterparts as Asian session traders caught up to the dollar-selling hype.

EUR/USD shot up by another 15 pips (+0.14%) to 1.1067, USD/CHF slipped by another 24 pips (-0.25%) to .9733, and GBP/USD inched another 6 pips higher (+0.05%) to 1.2239.

Watch Out For:

  • 7:00 am GMT: Nationwide house price index (0.2% expected, 0.3% previous)
  • 8:15 am GMT: Spanish manufacturing PMI (52.7 expected, 52.3 previous)
  • 8:45 am GMT: Italian manufacturing PMI (51.5 expected, 51.0 previous)
  • 8:50 am GMT: French final manufacturing PMI expected to remain at 51.3
  • 8:55 am GMT: German unemployment change (0K expected, 1K previous)
  • 8:55 am GMT: German final manufacturing PMI expected to remain at 55.1
  • 9:00 am GMT: Euro Zone final manufacturing PMI expected to remain at 53.3
  • 9:30 am GMT: U.K. construction PMI (51.9 expected, 52.3 previous)

See also:

U.S. Session Recap
London Session Recap

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