Asia Summary and Highlights 16 Mar
Japan warns ready to take decisive action on FX
Trump demands allies to help on Strait of Hormuz
The U.S. struck Iranian military targets on Kharg Island over the weekend
Asia session
As the U.S. struck Iranian military targets on Kharg Island (Largest oil export facilities) over the weekend, oil price jumped on Monday's open as Iran retaliates and threats within the Strait of Hormuz remain. Trump is calling for allies to help on Strait of Hormuz, especially Japan, South Korea and UK as they are most affected by energy disruption. The broader risk mood seems to be improving but remain on thin ice. AUD/USD is trading 0.35% higher at 0.7005. NZD/USD is trading 0.52% higher while USD/CAD slips 0.03%.
Japan’s finance minister warned that FX markets are “extremely volatile.” An escalation in terms of verbal intervention. While it stalled USD/JPY trip to 160, its impact is limited given the current geopolitical bids for USD. The 2024 circa 162 figure will likely be challenged soon if USD bids stay reckless. USD/JPY is trading 0.12% lower at 159.52. Else, EUR/USD is up 0.23% and GBP/USD is up 0.22%.