Asia Summary and Highlights 6 Oct
Sanae Takaichi elected to be the new LDP party leader
USD/JPY jumped figures
Major currency pairs open in favor of USD
Asia Session
Over the weekend, we see Sanae Takaichi elected to be the new LDP party leader, defeating Shinjiro Koizumi. As known as a prodigy of "Abenomics", she has been viewed as tilted towards more fiscal spending and her remarks regarding BoJ over the weekend is definitely capturing eyeballs even it is not a direct order. Market participants are scaling back their expectation of a October hike and see USD/JPY rocket higher to 150.26 currently, opening significantly higher at 149.43 from 147.46 Friday's close.
Nikkei is leading with more than 6% of gains in the equity space with U.S. major equity indexes also in the green while regional equities in Hong Kong and China perform individually. Major currency pairs opened in favor of the USD, mostly dragged by the strength in USD/JPY. Most have closed the gap except for USD/JPY. AUD/USD is trading 0.02% higher at 0.6604, NZD/USD is trading 0.03% lower at 0.5830 while USD/CAD rises 0.04%. Else, EUR/USD is down 0.21% and GBP/USD is down 0.27%.
North American session
With the non-farm payroll postponed due to the government shutdown, on which there was no sign of any progress, data focus was on September’s ISM services index. This was weaker than expected at 50.0 from 52.0, but with prices paid slightly higher at 69.4 from 69.2.
EUR/USD saw a brief bounce on the data before returning to near 1.1740 but with UST yields moving higher USD/JPY picked up to near 147.50 from 147.35. EUR/GBP at .8710 from .8725, and EUR/CHF, at .9335 from .9350 were weaker. AUD/USD was little changed near .66 and USD/CAD slightly lower near 1.3950.