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A lack of market-moving catalysts inspired Asian session traders to continue selling the Greenback. Meanwhile, further losses in iron ore prices weighed on the Australian dollar.

  • Australia’s MI leading index improves by 0.3% vs. 0.1% growth in November
  • Japan’s trade surplus clocks in at 359B JPY vs. 530B JPY expected in December
  • Japan’s flash manufacturing PMI rises from 54.0 to 54.4 in January
  • New Zealand’s credit card spending up by 6.3% vs. 9.1% uptick in November

Major Events/Reports:

Japan’s data releases

It was 2/2 for Japan earlier today, as it printed better-than-expected trade and manufacturing PMI reports.

Japan posted a 359B JPY trade surplus for the month of December, which might be a tad lower than the expected 530B JPY figure, but still marks the seventh consecutive month of surplus for the report.

According to the Ministry of Finance (MoF), exports had risen by a strong 9.3% from a year earlier in December to hit its largest volumes since September 2008 and thirteenth consecutive month of increases.

Apparently, outbound shipments of machinery (+13.9%) led the gains and helped Japan hit record-high exports to China and Asia. Wowza!

Imports also improved by 14.9%, which is faster than the expected 12.3% uptick but below November’s 17.2% growth. A closer look tells us that purchases of mineral fuels (+27.6%) and electrical machinery (+18.8%) led the gains.

A separate manufacturing PMI report boosted Japan’s rep further, as its reading improved from 54.0 to 54.44 in January. Overall, today’s reports portray a strong economy through Q4 2017 that could easily extend into 2018.

Mixed equities and commodities prices
The Asian bourses weren’t as consistent as the U.S. equities as country-specific catalysts factored in.

  • Nikkei took a breather from its previous gains and lost 0.63% to 23,973.00;
  • Australia’s A SX 200 shot up by 0.36% to 6,058.60;
  • Hang Seng dipped by 0.21% to 32,860.00, while
  • Shanghai index inched 0.14% to 3,551.58.

Commodity prices weren’t any consistent with gold prices rising on the back of dollar’s gains while oil prices lollygagged near their open prices.

Gold is up by a 0.30% to $1,340.7 and Brent crude is up by another 1.33% to $69.54, but a bearish U.S. oil report dragged U.S. WTI prices 0.05% lower to $64.44.

Major Market Mover(s):

USD

The Greenback continued to lose pips against its major counterparts as Asian session traders priced in the previous session’s catalysts.

EUR/USD is up by 19 pips (-0.16%) to 1.2318;
GBP/USD is up by 42 pips (+0.30%) to 1.4038;
USD/JPY is down by 38 pips (-0.35%) to 109.92, and
USD/CHF is down by 24 pips (-0.25%) to .9553.

AUD

Chinese iron ore futures fell for a second consecutive day today as traders continued to worry over major producers adding more supply to the already bloated stockpiles. Of course, it also doesn’t help that many are pricing in a seasonal decrease in overall demand.

AUD/USD might be up by 0.10% on dollar weakness, but
AUD/JPY is down by 0.27% to 87.98;
AUD/NZD is down by 0.07% to 1.0866, and
AUD/CHF is down by 0.17% to 0.7646.

Watch Out For:

  • 8:00 am GMT: France’s flash manufacturing PMI (58.7 expected, 58.8 previous)
  • 8:00 am GMT: France’s flash services PMI (58.9 expected, 59.1 previous)
  • 8:30 am GMT: Germany’s flash manufacturing PMI (63.2 expected, 63.3 previous)
  • 8:30 am GMT: Germany’s flash services PMI (55.6 expected, 55.8 previous)
  • 9:00 am GMT: Euro Zone’s flash manufacturing PMI (60.4 expected, 60.6 previous)
  • 9:00 am GMT: Euro Zone’s flash services PMI (56.5 expected, 56.6 previous)
  • 9:30 am GMT: U.K.’s unemployment rate to remain at 4.3%?
  • 9:30 am GMT: U.K.’s claimant count change (2.3K expected, 5.9K previous)