Asia Summary and Highlights 30 July
Waiting for BoJ as majors perform individually
Asia Session
The USD/JPY is relatively steady on Tuesday Asia session as we wait for the BoJ decision. Our central forecast only sees the BoJ to reduce bond purchase by 1-1.3 trillion JPY, accelerating to 3 trillion in two years and we do not see the BoJ to hike rates at the same meeting given the current inflation picture and soft consumption. USD/JPY is recovering partial July losses to avoid getting wrong footed by BoJ again. The pair is trading 0.21% higher at 154.33 with U.S. Treasury yields outperforming JGB yields.
While major FX pairs are performing individually, the Kiwi is leading the pack against the USD to trade 0.26% higher at 0.5891. It does not seem to be affected by soft regional sentiment like the Aussie on Tuesday Asia. AUD/USD is only up 0.06% to 0.6553 while USD/CAD slipped 0.05% despite oil also slipping. Else, EUR/USD is up 0.02% and GBP/USD is down 0.06%.
North American session
The USD initially extended gains before stabilizing in a session with little news. EUR/USD found support near 1.08 and recovered to 1.0825 while USD/JPY stabilized near 154 after seeing highs marginally above. GBP/USD recovered more significantly from European losses, rising to 1.2865 after bottoming near 1.28, seeing EUR/GBP ending lower on the day near .8415 after peaking near .8460. USD/CAD advanced to 1.3850 but AUD/USD remained near .6550.