31 Jul 2015
Yen rebounds on upbeat Japan’s CPI, EZ CPI – Next up
FXStreet (Mumbai) - The above estimates Japan’s CPI data offered the much-need impetus to the JPY bulls, thereby lifting the Japanese currency from fresh seven-week lows. While the Antipodeans traded mixed reacting to the latest economic news from their respective economies.
Key headlines in Asia
Japan’s National CPI rises 0.4% y/y in June, outpaces expectations
Another huge disappointment in the ANZ activity outlook
Australia’s factory gate prices q/q rise at a slower pace
Dominating themes in Asia - centered on JPY, AUD, NZD
An eventful Asian session, with a series of macro data reported across the Asia-Pac currencies. While the US dollar remained fairly weaker, correcting heavy gains from Thursday following a rebound in the second quarter US growth numbers which boosted the greenback to fresh weekly highs against its major peers.
The AUD/USD pair wavers around 0.73 handle, posing a tepid recovery from fresh six year lows reached at 0.7252 on Thursday, as markets chose to ignore s sluggish PPI and private sector data from Australia. Producer Price Index (QoQ) declined to 0.3% from previous 0.5% while the country’s private sector credit (YoY) fell from previous 6.2% to 5.9% in June.
While the Kiwi accelerated losses and lost 0.66 handle after another big drop in NZ business confidence levels badly hit the sentiment around the New Zealand dollar. ANZ business confidence survey (-15 now, previous -2.3) disappointed markets falling to levels not seen in the last four years on the back of sliding commodity prices especially dairy products.
The dollar-yen pair retreated in Asia, after the yen bulls jumped back into the bids cheering a tad better than expectations Japan’s national CPI print. Japan’s national CPI excluding fresh food rose 0.1% from a year earlier, the statistics bureau said Friday. Markets had estimated a flat reading.
Most Asian markets were mixed with Nikkei in Tokyo erased gains and now trades -0.10%. While Chinese markets fell once again after the regulators restricted 24 stock trading accounts for suspected trading irregularities, SSEC -1%. The Australian benchmark S&P/ASX 200 was the top performer advancing 0.5%. While South Korea’s Kospi is down -020%.
Heading into Europe - centered on EUR, GBP
We have a data-heavy European session ahead, kicking-off with German retails sales followed by Eurozone flash CPI and employment data.
Germany will publish the results of retail sales in June, following the 0.5% hike in May, and losing 0.4% year-on-year.
The euro zone will publish its July inflation data estimate, with inflation expected to register a 0.2% increase year-on-year. In June, consumer price growth in the euro zone also reached a 0.2% annual level.
The euro zone will also report its June labor data. The rate of registered unemployed in the region was 11.1% in May, and it is expected to remain at the same level.
Looking ahead, Employment Cost Index (ECI) from the US will shed more light on the stubbornly slow wage growth in the face of a substantial tightening of the jobs market. The baseline scenario is for a 0.6% increase in labor costs.
While key GDP figures from Canada will also be closely eyed later in the NA session. Canada’s GDP is estimated to post 0% growth during the fifth month of the year, following a negative print of 0.1% in April, according to consensus.
EUR/USD Technicals
The AceTrader team explained, "Euro's decline from this week's high of 1.1129 (Monday) to as low as 1.0894 yesterday signals correction from July's 12-week bottom at 1.0808 has ended there and as long as 1.1122 (previous support, now resistance) holds, consolidation with downside bias remains, a daily close below 1.0869 would retain bearishness for a re-test of 1.0808 next week.”
“On the upside, only a move back above 1.1122 would prolong choppy trading but price should falter below 1.1080 (post-FOMC high on Wed) and yield another fall."
Key headlines in Asia
Japan’s National CPI rises 0.4% y/y in June, outpaces expectations
Another huge disappointment in the ANZ activity outlook
Australia’s factory gate prices q/q rise at a slower pace
Dominating themes in Asia - centered on JPY, AUD, NZD
An eventful Asian session, with a series of macro data reported across the Asia-Pac currencies. While the US dollar remained fairly weaker, correcting heavy gains from Thursday following a rebound in the second quarter US growth numbers which boosted the greenback to fresh weekly highs against its major peers.
The AUD/USD pair wavers around 0.73 handle, posing a tepid recovery from fresh six year lows reached at 0.7252 on Thursday, as markets chose to ignore s sluggish PPI and private sector data from Australia. Producer Price Index (QoQ) declined to 0.3% from previous 0.5% while the country’s private sector credit (YoY) fell from previous 6.2% to 5.9% in June.
While the Kiwi accelerated losses and lost 0.66 handle after another big drop in NZ business confidence levels badly hit the sentiment around the New Zealand dollar. ANZ business confidence survey (-15 now, previous -2.3) disappointed markets falling to levels not seen in the last four years on the back of sliding commodity prices especially dairy products.
The dollar-yen pair retreated in Asia, after the yen bulls jumped back into the bids cheering a tad better than expectations Japan’s national CPI print. Japan’s national CPI excluding fresh food rose 0.1% from a year earlier, the statistics bureau said Friday. Markets had estimated a flat reading.
Most Asian markets were mixed with Nikkei in Tokyo erased gains and now trades -0.10%. While Chinese markets fell once again after the regulators restricted 24 stock trading accounts for suspected trading irregularities, SSEC -1%. The Australian benchmark S&P/ASX 200 was the top performer advancing 0.5%. While South Korea’s Kospi is down -020%.
Heading into Europe - centered on EUR, GBP
We have a data-heavy European session ahead, kicking-off with German retails sales followed by Eurozone flash CPI and employment data.
Germany will publish the results of retail sales in June, following the 0.5% hike in May, and losing 0.4% year-on-year.
The euro zone will publish its July inflation data estimate, with inflation expected to register a 0.2% increase year-on-year. In June, consumer price growth in the euro zone also reached a 0.2% annual level.
The euro zone will also report its June labor data. The rate of registered unemployed in the region was 11.1% in May, and it is expected to remain at the same level.
Looking ahead, Employment Cost Index (ECI) from the US will shed more light on the stubbornly slow wage growth in the face of a substantial tightening of the jobs market. The baseline scenario is for a 0.6% increase in labor costs.
While key GDP figures from Canada will also be closely eyed later in the NA session. Canada’s GDP is estimated to post 0% growth during the fifth month of the year, following a negative print of 0.1% in April, according to consensus.
EUR/USD Technicals
The AceTrader team explained, "Euro's decline from this week's high of 1.1129 (Monday) to as low as 1.0894 yesterday signals correction from July's 12-week bottom at 1.0808 has ended there and as long as 1.1122 (previous support, now resistance) holds, consolidation with downside bias remains, a daily close below 1.0869 would retain bearishness for a re-test of 1.0808 next week.”
“On the upside, only a move back above 1.1122 would prolong choppy trading but price should falter below 1.1080 (post-FOMC high on Wed) and yield another fall."