Asian Session Forex Recap – Nov. 21, 2016

  • Japan trade surplus clocks in at 0.47T JPY vs. 0.61T expected, 0.36T previous
  • NZ credit card spending (y/y) up by 10.2% vs. 8.5% in September
  • Japan’s all industries activity pops up by 0.2% vs. 0.1% expected, 0.2% previous

With not a lot of data on the docket, Asian session forex traders focused on extending last week’s economic themes. Here’s what’s up!

Major Events:

Japan’s trade data – Trade numbers from the world’s third largest economy reflected sluggish global demand and the impact of a strong yen in October.

Japan posted a trade surplus of 496.17 billion JPY for the month of October, marking its second consecutive month in the green. Exports declined by 10.3% from a year earlier and extended its consecutive decline to 13 consecutive months, while imports shrank by another 16.5% after already falling by 16.3% in September.

A closer look tells us that exports to China alone fell by 9.2% from a year earlier, while exports to all Asian countries slipped by 9.9%. Exports to the EU also slid by 9.5% while shipments to the U.S. fell by 11.2%.

In product terms, metalworking (-26.9%) and iron and steel products (-19.3%) suffered the biggest hits, followed by computer parts (-17.3%), manufactured goods (-15.2%), and electrical machinery (-10.9%).

Imports didn’t fare much better. Shipments from China dropped by 17.9% and contributed to a 17.4% drag from all of Asia. Imports from the EU also fell by 12.0% and shipments from the U.S. showed a 9.9% decline.

Overall the numbers reflect a bit of the yen strength that we saw in October, as well as weak demand for steel and automobile exports in the Middle East. Will the yen weakness in November translate to better trade numbers?

Overall risk appetite – With not a lot of data on the docket, Asian session market players mostly extended last week’s economic themes. Asian bourses ended the day mixed with the Shanghai index up by 0.61% and Nikkei up by another 0.75% while Hang Seng slipped by 0.09% and Australia’s A SX 200 showed a 0.15% decline.

Meanwhile, the prospect of production cut deal in the upcoming OPEC meeting boosted oil prices. Brent crude oil is up by 1.24% to $47.45 while U.S. crude oil prices is up by 1.25% to $46.94.

Major Market Movers:

JPY – The yen started the day on a weak footing, as USD/JPY traders made a run for the 111.00 handle and dragged the rest of the yen crosses with it.

USD/JPY hit a high of 111.20 before settling back to 111.11, GBP/JPY popped up to 137.25 before closing at 137.11, while EUR/JPY shot up by 26 pips (+0.22%) to 117.73.

CAD – Not surprisingly, the rise in oil prices boosted the oil-related Loonie higher.

USD/CAD slipped by 14 pips (-0.10%) to 1.3483, EUR/CAD fell by 14 pips (-0.10%) to 1.4285, CAD/JPY popped up by 27 pips (+0.33%) to 82.41, and AUD/CAD dropped by 43 pips (-0.43%) to .9867.

Watch Out For:

  • No major economic releases from the European region
  • France’s Sarkozy is knocked out of the Republican Presidential race. Keep your eyes on the charts for its impact on the euro!

See also:

Last Week’s Top Forex Movers

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