Article Highlights

  • Japanese trade deficit at 0.36T JPY in Sept vs. 0.07T JPY forecast
  • Japan’s exports down 1.7%, imports down 1.9%
  • Japanese all industries activity index slumped by 0.2%
  • New Zealand GDT index down by 3.1% in latest auction
  • New Zealand credit card spending up by 7.3% y/y in Sept
  • Fitch lowered Fonterra credit ratings
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So much for a dairy sector rebound! Kiwi bulls had their hopes smashed by the 3.1% fall in the Global Dairy Trade index early on in the Asian session, leading to declines across the forex board. It didn’t help that this prompted credit rating agency Fitch to lower Fonterra’s rating from AA- to A. Not even the 7.3% year-over-year increase in credit card spending in the country was enough to keep the Kiwi afloat.

NZD/USD is down 25 pips to .6727 (-0.37%), NZD/JPY is down 18 pips to 80.74 (-0.22%), EUR/NZD is up 80 pips to 1.6876 (+0.48%), and GBP/NZD is up 94 pips to 2.2945 (+0.42%).

Japan had its fair share of bleak economic data, as the September trade balance came in short of consensus with a deficit of 0.36 trillion JPY versus the projected 0.07 trillion JPY shortfall. Exports were down 1.7% while imports fell by 1.9%, reflecting a drop in both local and international demand. The country’s all industries activity index printed a 0.2% decline, slightly worse than the projected 0.1% dip.

USD/JPY is up 15 pips and closing in on the 120.00 handle once more (+0.12%), EUR/JPY is up 28 pips to 136.20 (+0.21%), GBP/JPY is up 14 pips to 185.15 (+0.07%), and AUD/JPY is flat at 87.00.

Only the U.K. public sector borrowing data is on today’s docket for the London trading session, which means that the pound could draw a bit more support from the smaller deficit of 9.1 billion GBP compared to the previous 11.3 billion GBP shortfall. Other than that, stay on the lookout for any other news reports that might impact forex price action and push certain currencies in a particular direction. Be careful out there!

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U.S. Session Recap

Bonnie and Clyde, peanut butter and jelly, Kanye West and Kanye West. Some things just go well together.

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