Asia Summary and Highlights 24 Feb
USD rebounds on Tuesday
Asia Session
The USD is rebounding against majors on Tuesday's Asia session. The broader strength seems to be driven by the fading of fear in geopolitical uncertainty as seen in the positive U.S. equities. USD/JPY is trading 0.26% higher at 155.05 with JGB yields recovering most of the opening losses.
Risk is showing some signs of rebound but does not indicate any strong commitment yet, given the current geopolitical and tariff uncertainty. U.S. and Chinese equities holding onto the green while other major equity indexes performing individually. AUD/USD is trading 0.13% higher at 0.7064. NZD/USD is trading 0.14% while USD/CAD is unchanged. Else, EUR/USD is down 0.03% and GBP/USD is unchanged.
North American session
Americas trading then saw the USD drifted marginally lower again in technical trading. Traders are now waiting for Trump’s state of the union speech on Tuesday for guidance on tariffs, immigration policy, cost of living, Iran, Cuba and Greenland. Iran is seen to the highest risk near-term, with some traders fearing that a limited strike could occur in the next 5-10 days. However, traders are uncertain about the USD’s reaction. Traditional USD benefit from safe haven flows could be counterbalanced by a selloff in U.S. equities. Some see the JPY as a beneficiary if an attack occurs, given the outstanding short JPY positions.