Asia Summary and Highlights 18 Jul
Japan June CPI elevated
Asia Session
Japan June National CPI remain above 3%, with headline at 3.3% y/y, ex fresh food also 3.3% while ex fresh food and energy at 3.4%. With such core-core data continue to point higher, the BoJ will have a difficult time shifting the blame to transitory factor. The BoJ is also expected to revise their inflation forecast higher but unlikely to change forward guidance nor rates. USD/JPY is trading 0.05% higher at 148.68.
The broader risk sentiment is upbeat on Friday. Fed speaker Waller's comment supports an imminent cut while the PBoC took measures to ease seasonal market stress. U.S. three major equity indexes and regional equities are all in the green, except for Japan. AUD/USD is trading 0.21% higher at 0.6501, NZD/USD is also trading 0.33% higher at 0.5950 while USD/CAD slips 0.09%. Else, EUR/USD is up 0.22% and GBP/USD is up 0.06%.
North American session
US data was stronger than expected, with June retail sales up by 0.6%, initial claims falling to 221k from 228k and July’s Philly Fed manufacturing survey bouncing to 15.9 from -4.0. However, the boost to the USD from the data was small and brief, and the USD subsequently moved slightly below pre-data levels, EUR/USD near 1.16 and USD/JPY near 148.60. AUD/USD recovered from European lows to .6490.