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China, Japan, and Australia all printed economic reports, but that didn’t stop Asian session forex traders from picking up where their U.S. counterparts left off and pushed JPY even higher.

  • Japan’s bank lending (y/y) up by 3.0% vs. 2.9% uptick expected, 2.8% growth previous
  • Japan’s PPI (y/y) up by 1.4% vs. 1.5% expected, 1.1% previous
  • Japan’s core machinery orders up by 1.5% vs. 3.9% growth expected, 3.2% decline in January
  • AU Westpac consumer sentiment slips by 0.7% vs. 1.1% increase in February
  • China’s CPI (y/y) clocks in at 0.9% vs. 1.1% growth expected, 0.8% previous
  • China’s PPI (y/y) rises by 7.6% vs. 7.4% expected, 7.8% previous

Major Events:

Japan’s data dump – Data from the Land of the Rising Sun mostly showed positive numbers despite missing analyst estimates.

Bank loans rose by 3.0% from a year earlier in March, marking the fastest growth since May 2009. Analysts had only expected a 2.9% growth after seeing a 2.8% uptick in February.

Meanwhile, core machinery orders – a leading indicator of business production – increased by 1.5% in February after declining by 3.2% in January. On an annualized basis, this translates to a 5.6% growth after January’s 8.2% decline.

A closer look tells us that manufacturing orders gained 6.0% for the month while non-manufacturing orders inched 1.8% higher. Government orders dropped by a whopping 35.4%, however, while orders from overseas dipped by 1.1% and orders from agencies rocketed by 18.9%.

Rounding up the set of relatively positive news is the annualized PPI report. The Bank of Japan (BOJ) said inched 0.2% higher in March, matching February’s growth. On an annualized basis, this translates to a 1.4% increase from an upwardly revised 1.1% uptick in February.

Though they don’t usually affect the markets, today’s Japanese reports only made the yen even more attractive amidst the risk aversion in the markets.

China’s CPI – The world’s second largest economy printed its inflation numbers earlier today and market players weren’t impressed.

Producer prices, for one thing, jumped by a 7.6% in March, which is in line with lower iron ore and oil prices as well as expectations of cooling after February’s eight-year high (7.8%) increase.

Consumer prices, on the other hand, only grew by 0.9% from a year ago in March. Its growth may be higher than February’s 0.8% uptick, but it still missed expectations of a 1.0% gain.

A closer look tells us that drops in food and vegetable prices may have held back the rise in consumer prices.

Market players are expecting producer prices to continue to moderate in the coming months as the economy begins to cool from the PBoC’s tightening measures. Meanwhile, consumer prices are seen to increase somewhat as higher property and producer prices eventually make its way to consumer prices.

These pressures aren’t expected to affect the PBoC’s tightening stance, though, which is probably why the reports barely made a dent on the major currencies during the slow session.

Market Movers:

JPY – The yen raked up a couple more pips against its counterparts as favorable Japanese data got mixed in with overall risk aversion that got extended from the previous session.

USD/JPY lost another 20 pips (-0.18%) to 109.50, EUR/JPY dropped by 29 pips (-0.25%) to 116.06, and AUD/JPY fell by 19 pips (-0.23%) to 82.04.

Watch Out For:

  • 6:00 am GMT: German wholesale price index (0.4% expected, 0.5% previous)
  • 8:00 am GMT: BOE Governor Mark Carney to give a speech in London
  • 8:30 am GMT: U.K. unemployment rate expected to remain at 4.7%
  • 8:30 am GMT: U.K. average earnings index (3m/y) (2.1% expected, 2.2% previous)
  • 8:30 am GMT: U.K. claimant count change (-10.2K expected, -11.3K previous)
  • 10:00 am GMT: POTUS Trump’s interview on Fox Business Network. He’s expected to talk about his health and fiscal policies, as well as his take on the Syrian crisis and North Korea’s threats.