Asia Summary and Highlights 21 Oct
Takaichi likely the next PM for Japan
Asia Session
With Ishin's support, Takaichi will become the latest PM for Japan and will begin naming her cabinet on Tuesday. The vote is ongoing but there seems to be little surprise. As a fiscal dove, her naming will be closely watched to see if she remain committed to "Abenomics". USD/JPY has risen to 0.22% at 151.06, challenging the Monday high.
Regional sentiment is better than U.S. major equity indexes. Chinese and Hong Kong equities are gaining more than a percent with Japanese equities follow and U.S. major equity indexes in the red. Trump is again posing another tariff threat on China but the market is generally waiting for his TACO comments. AUD/USD is trading 0.17% lower at 0.6502, NZD/USD is trading 0.25% lower at 0.5729 while USD/CAD rises 0.08%. Else, EUR/USD is down 0.05% and GBP/USD is down 0.1%.
North American session
It was a quiet session for FX, though equities were firmer and UST yields slightly lower. The USD was slightly firmer, with EUR/USD dipping below 1.1650 and USD/JPY returning to 150.70 after a dip below 150.50. AUD/USD however moved back above .65 to .6515 while USD/CAD was little changed near 1.4035.
Canada’s September IPPI at 0.8% was stronger than expected. The BoC’s Quarterly Business Outlook survey was little changed overall at -2.28 from -2.40 but future sales growth at -2 from 6 was the weakest since Q2 2023.