Asia Summary and Highlights 20 Nov
BOJ’s Koeda signals need for further tightening as inflation holds near 2%
Asia Session
Fast approaching annual high, the JPY has received no mercy. Despite BOJ’s Koeda signals need for further tightening as inflation holds near 2%, a hawkish tilt from her previous vote to keep rates on hold, the fiscal worry on new stimulus package seems to have continue to weigh on JGB and see 10yr JGB yields searching for new high above 1.8%. USD/JPY is trading 0.24% higher at 157.52.
The risk sentiment broadly upbeat on Thursday, driven by strong NVidia earnings that beat estimate. Regional sentiment was also initially supported by stimulus hope from the Chinese government, though it fades as session progress while Nikkei kept the most gains. AUD/USD is trading 0..04% higher at 0.6481, NZD/USD is unchanged while USD/CAD rises 0.08%. Else, EUR/USD is down 0.19% and GBP/USD is down 0.05%.
North American session
The USD was stronger across the board as traders awaited Thursday’s September non-farm payroll and FOMC minutes from October 29 released in the afternoon, which bought a modest reaction but the USD strength persisted. The minutes showed strongly differing views on whether easing would be appropriate in December and some debate over the decision to ease in October. Earlier the Labor Dep‘t announced that November’s non-farm payroll, originally scheduled for December 5, would be released on December 16, including a partial October report, with a non-farm payroll but not an unemployment rate. This report will therefore be too late for the December 10 FOMC meeting.
USD/JPY gains extended to reach 157 while EUR/USD fell to around 1.1525. EUR/JPY tested 181, EUR/GBP was slightly firmer near .8830 while EUR/CHF remained firm near .9290. USD/CAD rallied from near 1.40 to near 1.4060 while AUD/USD fell to .6570 from .6490.