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14 Apr 2015
Yen steals the show in Asia, UK CPI – Next in focus
FXStreet (Mumbai) - The yen extended it dominance across the board in Asia, with USD/JPY capped by 120 barrier. While the Antipodeans continue their recovery path after the Chinese trade data induced massive sell-off on Monday.
Key headlines in Asia
New Zealand business confidence: Growth moderates to a more sustainable level
Japan's Hamada: Yen at 105 per dollar would be appropriate
Tentative signs of improvement in the NAB Monthly Business Survey
USD/JPY supported at 119.70
Dominating themes in Asia - centered on JPY, AUD, NZD
A quiet Asia, with the Japanese PM's adviser Koichi Hamada’s reiteration that yen at 105 per dollar would be appropriate continue to bolster the Japanese currency versus the US dollar. While, Asian equities remain subdued tracking overnight Wall Street losses and the stronger yen dragging Japanese stocks lower.
The entire Antipodean complex rebounded this session, recovering partial losses on China backed massive sell-off witnessed yesterday. Moreover, the Aussie and its OZ counterpart both received impetus from upbeat OZ business confidence surveys which indicated that low inflation and accommodative policy settings make for easy business settings in Australia as well as in New Zealand.
Heading into Europe - centered on EUR, GBP
In the Europe session ahead, UK CPI data is expected to remain the highlight amid other 2-tier economic releases including German WPI numbers to kick –start the session, followed by Euro zone industrial production data.
Core CPI inflation in the UK, an underlying reading of domestic price pressures, is expected to have remained unchanged from the previous month at +1.2% - the lowest level since December 2008. While, the annual rate of the UK CPI dropped to 0% in February, the lowest official rate on record. The Office for National Statistics is releasing March figures on Tuesday at 8:30GMT.
Meanwhile, the Euro zone industrial production is expected to have picked up by 0.3% in February after a January -0.1% drop. EZ data is due to be publsihed at 9GMT.
Further insights for EUR, GBP traders in the day ahead, Valeria Bednarik, Chief Analyst – FXStreet notes, "The UK will release several inflation-related figures on Tuesday, expected overall weak, which therefore should prevent the British Pound from advancing further."
"If the price manages to advance above the mentioned 1.4710 level, the pair could extend towards next resistance, formed by former intraday lows in the 1.4750 price zone, while only beyond this last the pair can recover its upward potential for the upcoming sessions."
For EUR/USD, Jim Langlands, Founder at FXCharts states, “ the dailies remain negative and a break of this would signal a run to 1.0500 and then towards the previous, 13 Mar, 1.0461 low. Beyond there, support is again rather thin until the March 2003 low at 1.0334."
"On the topside, 1.0600/10 will act as minor resistance today ahead of further sellers likely to be seen at 1.0640 (23.6% of 1.1035/1.0520, a break of which would see a squeeze to 1.0680 (100 HMA) and to 1.0715 (38.2%)."
Key headlines in Asia
New Zealand business confidence: Growth moderates to a more sustainable level
Japan's Hamada: Yen at 105 per dollar would be appropriate
Tentative signs of improvement in the NAB Monthly Business Survey
USD/JPY supported at 119.70
Dominating themes in Asia - centered on JPY, AUD, NZD
A quiet Asia, with the Japanese PM's adviser Koichi Hamada’s reiteration that yen at 105 per dollar would be appropriate continue to bolster the Japanese currency versus the US dollar. While, Asian equities remain subdued tracking overnight Wall Street losses and the stronger yen dragging Japanese stocks lower.
The entire Antipodean complex rebounded this session, recovering partial losses on China backed massive sell-off witnessed yesterday. Moreover, the Aussie and its OZ counterpart both received impetus from upbeat OZ business confidence surveys which indicated that low inflation and accommodative policy settings make for easy business settings in Australia as well as in New Zealand.
Heading into Europe - centered on EUR, GBP
In the Europe session ahead, UK CPI data is expected to remain the highlight amid other 2-tier economic releases including German WPI numbers to kick –start the session, followed by Euro zone industrial production data.
Core CPI inflation in the UK, an underlying reading of domestic price pressures, is expected to have remained unchanged from the previous month at +1.2% - the lowest level since December 2008. While, the annual rate of the UK CPI dropped to 0% in February, the lowest official rate on record. The Office for National Statistics is releasing March figures on Tuesday at 8:30GMT.
Meanwhile, the Euro zone industrial production is expected to have picked up by 0.3% in February after a January -0.1% drop. EZ data is due to be publsihed at 9GMT.
Further insights for EUR, GBP traders in the day ahead, Valeria Bednarik, Chief Analyst – FXStreet notes, "The UK will release several inflation-related figures on Tuesday, expected overall weak, which therefore should prevent the British Pound from advancing further."
"If the price manages to advance above the mentioned 1.4710 level, the pair could extend towards next resistance, formed by former intraday lows in the 1.4750 price zone, while only beyond this last the pair can recover its upward potential for the upcoming sessions."
For EUR/USD, Jim Langlands, Founder at FXCharts states, “ the dailies remain negative and a break of this would signal a run to 1.0500 and then towards the previous, 13 Mar, 1.0461 low. Beyond there, support is again rather thin until the March 2003 low at 1.0334."
"On the topside, 1.0600/10 will act as minor resistance today ahead of further sellers likely to be seen at 1.0640 (23.6% of 1.1035/1.0520, a break of which would see a squeeze to 1.0680 (100 HMA) and to 1.0715 (38.2%)."