Asia Summary and Highlights 13 March
Japan's Shunto wage negotiations show most organizations asking wage hikes nearly twice as large as last year
Reprieve in equities did not last
Asia Session
There are more welcoming signs for the Japan spring wage negotiation as unions are asking for another historic hike circa 6%, which seems to have been accepted by most large enterprise. If more large business echoes and SMEs are able to catch up more than 50%, it would build a case for the BoJ to see inflation sustainably above 2%. USD/JPY is trading 0.25% lower at 147.85 as JGB outperform U.S. Treasury in yields.
With little sign of improvement in the global macro picture, the reprieve in sentiment did not last as we see choppy trading in the equity space again on Thursday. U.S. Treasury Yields are lower across curve but does not seem to be attracting much bids in equities. AUD/USD is trading 0.16% lower at 0.6310, NZD/USD is down 0.02% to 0.5728 while USD/CAD rose 0.12%. Else, EUR/USD is up 0.05% and GBP/USD unchanged.
North American session
US CPI came in weaker than expected at 0.2% overall and ex food and energy, but the kneejerk USD selloff was quickly reversed and more, as the market looked ahead to potential tariff-led acceleration in future months. Still, the USD later saw renewed slippage back to near the post-CPI lows, with no obvious trigger, USD/JPY falling back below 148.50 after briefly peaking above 149.
USD/CAD saw little reaction to an as expected 25bps BoC easing, which provided little in the way of forward guidance, and USD/CAD fell to 1.4375 from 1.4415 ahead of the US data.
While the USD remained mostly near post-CPI lows, EUR/USD slipped back below 1.09, closer to the low than the 1.0930 high with Trump critical of the EU over trade policy. EUR/GBP fell to near .84 from .8430 while EUR/CHF fell to near .96 after peaking above .9640.