Asian Session Forex Recap – Nov. 11, 2016

  • New Zealand food price index down by 0.8% vs. 0.9% dip in September
  • Japan’s PPI (y/y) down by 2.7% vs. 2.6% decline expected, 3.2% fall in September
  • Japan’s tertiary industry activity slips by 0.1% vs. 0.2% decline expected, 0.0% previous

With not a lot of major data on the docket, the Asian bourses continued to party in the streets on the back of expected improvements under the incoming Trump administration.

Major Events:

Extended post-election party – Asian bourses saw another green day today, as they tracked yesterday’s positive performance of their U.S. counterparts. ICYMI, market players are celebrating Trump’s successful Presidential bid, choosing to focus on his fiscal stimulus plans that could lift Uncle Sam’s inflation enough to push the Fed into raising its interest rates faster than they initially planned.

Nikkei jumped by another 1.1% to 17,526.61, a high not seen in six months, before settling back down with a 0.21% gain at 17,381.50. Australia’s ASX is also up by 0.79% while the Shanghai index clocked in a 0.71% gain. The only party pooper was Hang Seng, which slipped by 1.18%.

Dip in oil prices – The Black Crack was uninvited to the party after a report by the International Energy Agency (IEA) showed that OPEC members pumped a record 33.83 million barrels a day in October. Not only that, but the agency also warned that the oil glut will extend to 2017.

With the official OPEC meeting only a few days away, major oil producers will have to work extra hard to convince market players that whatever agreement they manage to pull off will have a significant impact in addressing the global oil oversupply problem.

Brent crude oil slipped by 0.39% to $45.66 while U.S. crude oil prices dropped by 0.47% to $44.45.

Major Market Movers:

USD – A bit of risk appetite in the markets took its toll on the low-yielding Greenback, which had seen sharp gains immediately after Trump’s election win.

EUR/USD rose by 13 pips (+0.12%) to 1.0903, USD/JPY slipped by 33 pips (-0.31%) to 106.51, and GBP/USD inched 5 pips higher (+0.04%) to 1.2558.

Comdolls – Commodity-related currencies like the Aussie, Loonie, and Kiwi had a topsy-turvy trading session. They started the day losing pips against the Greenback before risk appetite propelled them higher.

AUD/USD hit session bottom at .7560 before finishing at .7599, USD/CAD shot up to 1.3513 before leveling off to 1.3479, and NZD/USD fell to a low of .7187 before recovering to .7203.

Watch Out For:

  • French markets out on Armistice Day
  • 8:00 am GMT: German final CPI expected to remain at 0.2%
  • 8:00 am GMT: German wholesale price index (0.2% expected, 0.4% previous)
  • 10:30 am GMT: U.K. construction activity (0.2% expected, -1.5% previous)

See also:

U.S. Session Recap
London Session Recap

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