U.S. Session Recap
- Pending home sales weaker than expected at 0.6%
- BOJ policymakers warned of downside price risks
- RBA official Lowe thinks AUD is overvalued, threshold for intervention is high
The Greenback refused to back down against its major counterparts, despite the downside surprise in U.S. pending home sales. The report showed a 0.6% decline for October instead of the estimated 2.2% rebound. Although the previous month’s figure was revised up from -5.6% to -4.6%, pending home sales data marked its sixth consecutive monthly decline.
Earlier today, RBA official Philip Lowe pushed the Aussie down under when he remarked that the currency is high historically and that further adjustment in AUD/USD levels might be in the cards. Aussie pairs did find a bit of support when he said that there’s no need to worry about house price inflation but those gains were erased when pointed out that the threshold for central bank intervention is fairly high.
Also today, the minutes of the BOJ monetary policy meeting were released and these revealed that some policymakers are concerned about downside price risks. This forced most yen pairs to pause from their recent rallies, although nearby support levels are still holding as of this writing.
No other major reports are due for the rest of today’s Asian session so much of price action could hinge on market sentiment. Do keep tabs on how equities are faring, especially with the Nikkei, if you’re planning on trading yen pairs.
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