Asian Session Forex Recap – Nov. 24, 2016

  • Japan’s flash manufacturing PMI down to 51.1 in November vs. 51.7 expected, 51.4 previous
  • Dollar continues to dominate across the board

Another day, another chance to buy the dollar! Japanese forex traders are back from their holiday today, and they sure didn’t waste time pricing in the latest bullish run on the Greenback!

Major Events:

Japan’s manufacturing PMI – Manufacturing in the world’s third largest economy grew at a slightly slower pace in November despite further weaknesses in the local currency. New orders seems to be the culprit, as its index, which measures both domestic and external demand, fell to 50.4 from October’s 50.8 reading. Even the output component of the report showed a decline from a 53.3 to a preliminary reading of 52.2 this month.

The report underscored investor concerns that consumer spending prospects remain gloomy for the economy despite the BOJ and the government’s efforts.

Dollar domination – Asian session traders shrugged off Japan’s report in favor of pushing the dollar even higher across the board. One possible reason is that Japanese traders, who had a market holiday yesterday, could have jumped in on the dollar’s train up the charts. Of course, it also didn’t hurt that Uncle Sam’s reports printed yesterday mostly came in better-than-expected.

Another day, another yuan weakness – Another day of dollar domination meant another day of weakening the yuan for the People’s Bank of China (PBoC). The PBoC set USD/CNY’s midpoint at 6.9085, higher than yesterday’s 6.8904. Today marks the second consecutive day that China’s central bank has weakened the yuan after breaking its 12-day streak earlier this week.

Major Market Movers:

USD – The dollar was king of the forex hill today, as it continued to post gains against most of its counterparts.

EUR/USD is down by another 16 pips (-0.15%) to 1.0532, USD/JPY is up by 22 pips (+0.20%) to 112.81, and USD/CHF is up by another 12 pips (+0.12%) to 1.0184.

Comdolls – Commodity-related currencies were no match for the Greenback either, as a lack of reports dragged them even lower against the low-yielding currency.

AUD/USD slipped by another 16 pips (-0.22%) to .7372, USD/CAD inched 22 pips (-0.16%) higher to 1.3513, and NZD/USD got knocked down by another 24 pips (-0.34%) to .6980.

Watch Out For:

  • 8:00 am GMT: German final GDP (q/q) expected to remain at 0.2%
  • 10:00 am GMT: German IFO business climate (110.6 expected, 110.5 previous)
  • 10:30 am GMT: BBA mortgage approvals (38.8K expected, 38.3K previous)

See also:

U.S. Session Recap
London Session Recap

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