Asia Summary and Highlights 25 Mar

Asia Session

On Monday's Asia session, we have more verbal intervention from Kanda saying he is closely watching FX moves with high sense of urgency. It is an escalation of rhetoric as we see the USD/JPY continue to trade above 150 figure even after BoJ raised interest rate to 0%. It is hard to see a sustainable more north in a medium run when FOMC dotplot still showing 75bps of cut and BoJ beginning to move out of negative interest rate. But the January BoJ minutes released on Monday, albeit outdated, is showing members within BoJ is in no rush to further tighten. U.S. Treasury Yields are higher across the curve while JGB yields opened lower. USD/JPY is trading 0.04% lower at 151.34 after reaching session low of 151.05 on jawbone intervention.

The Aussie is gaining proxy support from the Yuan on Monday. The PBoC has fixed onshore yuan rate strongest in almost a year and the "National Team" is also seen buying, to support the Chinese Yuan after its big loss on Friday. Regional sentiment is positive in China and Hong Kong, U.S. equities little changed and Japan's Nikkei falls.  AUD/USD is trading 0.14% higher at 0.6523, NZD/USD up 0.06% to 0.5996 while USD/CAD is unchanged despite stronger oil. Else, EUR/USD and GBP/USD are 0.07% higher.

North American session

The USD saw some early losses, particularly versus the JPY, as UST yields dipped, though generally took on a firmer tone. USD/JPY skipped to 151 from 151.60 before gradually reversing most of the dip. GBP/USD moved off its lows as EUR/GBP found sellers at .86. EUR/USD was heavy, drifting down to test 1.08, while EUR/CHF slipped to .9710 from .9750. 

Comments from Fed’s Powell did not touch on monetary policy. The only data release was a 0.3% dip in Canadian retail sales which masked gains ex autos and in real terms. Despite the not-so-weak data, USD/CAD moved above 1.36 as oil slipped, while AUD/USD kept to a tight range just above .65.