Asia Summary and Highlights 14 Aug

Asia Session

The July Australian labor data is solid with unemployment rate lowered to 4.2% from 4.3% y/y. Headline employment change at 24.5k is overshadowed by strong full time employment of 60.5k. AUD/USD jumped higher to 0.6568 before retracing partially to trade 0.09% higher at 0.6552 while USD/CAD and NZD/USD are unchanged.

The JPY gained strongly on Thursday as USD is broadly weak, further exacerbated by US Treasury Secretary Scott Bessent remark on BoJ that they should hike rates to control inflation. It is quite uncommon for such a direct criticism, especially since Bessent also said he raised such topic with Ueda. USD/JPY slipped 0.67% lower at 146.38 with JGB yields higher. Else, EUR/USD and GBP/USD is down 0.01%.

North American session

With no significant data it was a quiet session but the USD tone remained softer as UST yields slipped in anticipation of a September FOMC easing. Two afternoon Fed speakers, Goolsbee and Bostic, however sounded less than convinced of the need for easing and the USD finished off its lows, USD/JPY near 147.45 from 147.10 and EUR/USD near 1.17 from 1.1730. GBP/USD held up better than most, and EUR/GBP fell below .8625.  

Bank of Canada minutes from July 30 showed disagreement on whether further easing would be needed, but there was little market response, USD/CAD also moving off its low to 1.3770 from near 1.3750.