Asia Summary and Highlights 14 May

Asia Session

The Australian Q1 wage price index has come in stronger than expected at +0.9% q/q and +3.4% y/y. As the Australian labor market remains choppy, wage price is surprisingly solid. The Australian wage growth has historically being lagging behind the strength of labor market and this Q1 data points to a lower likelihood the RBA will cut imminently. AUD/USD is trading unchanged at 0.6470, NZD/USD is 0.05% higher at 0.5940 while USD/CAD slips 0.06%. 

The Japan April PPI increased 0.2% m/m and 4% y/y, continue to suggest rising input cost. While the magnitude of transferal to CPI has been slow, it continues to point towards more input cost for the Japanese business owners.  USD/JPY is trading 0.35% lower at 146.94 with JGB yields outperform U.S. counterpart. Else, EUR/USD is up 0.03% and GBP/USD is unchanged.

North American session

US CPI came in on the weak side of expectations, up 0.2% both overall and core, 0.22% and 0.24% respectively before rounding. The initial response to the data was modest and UST yields, like equities, ended the day higher, but the USD moved steadily lower through the session. 

EUR/USD rose to 1.1185 from 1.110, while GBP/USD reached 1.33 from 1.3220. EUR/GBP saw limited movement but EUR/CHF rallied to .94 from .9350. USD/JPY slipped from 148.20 to 147.50. AUD/USD rallied to .6475 from .64 with AUD.CAD moving above .90, though USD/CAD did slip below 1.3950 after an early move above 1.40.