Asia Summary and Highlights 22 Apr

Asia Session

Risk sentiment is broadly positive on Monday with the lack of geopolitical escalation. Major equity indexes opened in the green with the exception of CSI as better than expected Chinese data recently diminish hopes of further stimulus. The antipodeans are supported by the waves of positive sentiment and outperformed the USD and peers on Monday. AUD/USD is trading 0.33% higher at 0.6438, NZD/USD fared better at 0.5914, 0.44% higher while USD/CAD slipped 0.15% to 1.3725.

As haven bids fade, USD/JPY resume its uptrend and is testing recent high at 154.78 again. It is quiet from the Japan side today as we did not hear any verbal intervention even if they means little. The lack of strength in past rhetoric has been the key reason for market not believing such words carries enough weight to stall JPY weakness. Still, there is no doubt BoJ will intervene when the pace of weakness accelerates. However, U.S. Treasury Yields remain much higher than JGB yields even when both increase for the day and see USD/JPY 0.06% higher at 154.69. Else, EUR/USD is 0.14% higher and GBP/USD up 0.15%.

North American session

The main move in the North American session was a weaker GBP, encouraged by BoE’s Ramsden expressing greater confidence that inflationary persistence was easing and that the balance of risks had oved to the downside. GBP/USD fell by a big figure to 1.2370. EUR/USD was dragged down to 1.0611 before recovering to around 1.0650 as EUR/GBP moved above .86.

USD/JPY held firm around 154.60 and the commodity currencies had little direction. There was no US data but the normally dovish Fed’s Goolsbee stated that the latest three months of inflation data could not be dismissed.