Asia Summary and Highlights 20 September

Asia Session

BoJ has kept rates unchanged at 0.25%. The statement indicates that BoJ view current trajectory of inflation in line with their forecast, which indirectly suggest the BoJ will go along their hawkish tilt and see more tightening coming. The Japan August Headline CPI has come in higher than prior at +3.0% y/y and will be support BoJ's hawkish policy take. Ex fresh food and ex fresh food & energy are also coming higher than July by 0.1% y/y. USD/JPY remains 0.28%  lower at 142.22 with U.S. Treasury Yields lower and JGB yields higher.

Regional equities are performing individually while U.S. three major equity indexes are all in the red by less than 0.1%. The USD is trading broadly softer and is benefiting the majors. AUD/USD reversed early gains to trade 0.08% lower at 0.6809, NZD/USD is uncahnged while USD/CAD rose 0.05% to 1.3565 as oil slips thrity cents. Else, EUR/USD is up 0.02% and GBP/USD is up 0.07%.

North American session

The Bank of England left rates unchanged as expected with a less dovish than expected 8-1 vote. EUR/GBP slipped to .8395 from .8420 but later edged back above .84. A bounce in GBP/USD above 1.33 was brief. 

The USD got a lift from a fall in initial claims to 219k from 231k while the September Philly Fed index bounced to 1.7 from -7.0, though the gain faded and the USD ended little changed, USD/JPY near 142.60 and EUR/USD near 1.1160. Gains in equities kept the riskier currencies supported.