13 Nov 2013
Session recap: Data pushed aside as “risk-off” attitude takes over
FXstreet.com (Barcelona) - The global attitude toward risk took a hit early Wednesday after disappointment grew following the Chinese Plenum meetings. Asian stocks fell as analysts and strategists came away disappointed by the lack of details attached to Chinese leaders’ rhetoric about the future of the Chinese economy as it transitions from a majority state-run to a majority private-sector-run. The bad equity performance has money seeking “safety” in the currency markets – including and especially in the Yen.
Mixed to slightly bearish data out of Japan showing little effect on the Yen
Weaker-than-expected Corporate Goods Prices and Machinery Orders data out of Japan took the Yen lower initially, but the “risk-off” trade’s re-emergence bulled up the Yen as the session wore on.
Aussie Dollar reacts bullishly to combo of low inflation and good consumer confidence
The Aussie Dollar rallied higher immediately after Aussie data was released that painted a picture of growing consumer confidence and only modest inflation.
Data released during the Asian session:
• The Reserve Bank of New Zealand’s Financial Stability Report – excerpts indicated optimism on economy and pointed to higher New Zealand interest rates in the next 12 -18 months.
• Aussie Consumer Confidence came in better than expected – giving the AUD an immediate boost
• Japanese Capital Goods Price Index came in slightly below expectations – Yen bearish in theory.
• Japanese Machinery Orders came out mixed – no real effect on the Yen.
• RBNZ Governor Wheeler’s speech was NZD-bullish – surprising after the recent action in the Kiwi.
• Aussie Wage Price Index came out slightly below expectations – indicating a low inflation environment in Australia for the time being.
For the rest of the Wednesday session, there will be a stream of minor data points for traders to digest. However, starting at around 9:30 GMT, traders will be focused on the British unemployment numbers and the Bank of England’s Quarterly Inflation Report.
Main headlines in Asia:
AUD/JPY slipped again Tuesday; support nearby at 92.10
Flash: China unveils very general guidelines for further reform - Nomura
Red alert for Asian equities
Flash: Room to be concerned after Chinese plenum outcome - Rabobank
AUD/USD working off oversold condition with modest upside; 0.9221 eventual target
Mixed to slightly bearish data out of Japan showing little effect on the Yen
Weaker-than-expected Corporate Goods Prices and Machinery Orders data out of Japan took the Yen lower initially, but the “risk-off” trade’s re-emergence bulled up the Yen as the session wore on.
Aussie Dollar reacts bullishly to combo of low inflation and good consumer confidence
The Aussie Dollar rallied higher immediately after Aussie data was released that painted a picture of growing consumer confidence and only modest inflation.
Data released during the Asian session:
• The Reserve Bank of New Zealand’s Financial Stability Report – excerpts indicated optimism on economy and pointed to higher New Zealand interest rates in the next 12 -18 months.
• Aussie Consumer Confidence came in better than expected – giving the AUD an immediate boost
• Japanese Capital Goods Price Index came in slightly below expectations – Yen bearish in theory.
• Japanese Machinery Orders came out mixed – no real effect on the Yen.
• RBNZ Governor Wheeler’s speech was NZD-bullish – surprising after the recent action in the Kiwi.
• Aussie Wage Price Index came out slightly below expectations – indicating a low inflation environment in Australia for the time being.
For the rest of the Wednesday session, there will be a stream of minor data points for traders to digest. However, starting at around 9:30 GMT, traders will be focused on the British unemployment numbers and the Bank of England’s Quarterly Inflation Report.
Main headlines in Asia:
AUD/JPY slipped again Tuesday; support nearby at 92.10
Flash: China unveils very general guidelines for further reform - Nomura
Red alert for Asian equities
Flash: Room to be concerned after Chinese plenum outcome - Rabobank
AUD/USD working off oversold condition with modest upside; 0.9221 eventual target