Asia Summary and Highlights 6 Mar
Risk mood improves
Asia Session
The broader risk mood seems to improve as market participants are reading through headlines of no escalation. Multiple countries are pressing for a smooth sail in the Strait of Hormuz, could potentially ease the physical disruption of oil trades. Both equities and metal are perorming better on Friday and is seen supporting the Aussie. AUD/USD is trading 0.42% higher at 0.7037. NZD/USD is also trading 0.11% higher while USD/CAD slips 0.08% with oil gaining another dollar.
With soft words of intervention, JPY further weakens with JGB yields performing individually across the curve. USD/JPY is trading 0.22% higher. Else, EUR/USD is down 0.03% and GBP/USD is down 0.02%.
European and North American sessions
While Europe saw brief dips in both the oil price and USD, anxieties over the Middle East built through the North American session with oil seeing strong gains and equities sliding, before a late correction as the US Treasury stated it would announce measures to combat rising oil prices.
The commodity currencies came particular under pressure with AUD/USD seeing lows below .70 from .7050 and USD/CAD seeing highs above 1.37 from 1.3640 with only partial late corrections. EUR/USD was relatively stable, returning to near 1.16 after bouncing above in Europe and drifting below in North America. EUR/GBP was slightly weaker with GBP/USD finding support at 1.33. USD/JPY rose as high as 157.85 from around 157 before a late correction to 157.50.
US data was on the firm side of expectations with weekly initial claims unchanged at 213k and Q4 non-farm productivity and unit labor costs both increasing by 2.8% annualized, but had little impact.