Asia Summary and Highlights 17 June
U.S. Defense Production Act floated to force US insurer to cover Hormuz passage
Asia Session
To assist with his plan to reopen the Strait and keep oil price down, Trump is thinking about a fee-based naval escort scheme while using The Defense Production Act to force U.S. insurer to provide coverage. Oil continues to trade lower on optimism while equities perform individually. AUD/USD is trading 0.07% lower at 0.7062. NZD/USD is trading 0.1% lower while USD/CAD is unchanged.
Market participants are still digesting Tuesday's BoJ meeting and see USD/JPY consolidating recent moves. JGB yields are further lower across the curve after BoJ announcing a pause in bond purchase tapering. USD/JPY is trading 0.06% lower at 160.27. Else, EUR/USD and GBP/USD are up 0.04%.
North American session
In generally subdued trading the USD saw a dip in the morning but this was gradually retraced in the afternoon. USD/JPY trended steadily higher to 160.40 while EUR/USD gains peaked at 1.1620. EUR/GBP was quiet but EUR/CHF slipped from above .9220 to below .9210. AUD/USD was stable around .7070 but USD/CAD slipped back below 1.40.
May US housing starts fell sharply by 15.4% to 1.177m but this was largely on the volatile multiples sector with single starts down a modest 1.9%. Permits fell by 0.7% to 1.413m with single permits up by 0.6%.