Asia Summary and Highlights 25 February

Asia Session

Regional equities in China opened sharply lower but has since gradually recovered and once inch distance from the opening gap. HSI and Nikkei are also in the red while U.S. three major equity indexes are taking a breather. AUD/USD dipped and recovered to trade 0.05% higher at 0.6351. Trump confirmed that the tariffs on Mexico and Canada set to take effect on March 4  but it does not seem to have a lasting impact on the FX market. NZD/USD is up a pip while USD/CAD slipped 0.05% to 1.4252 as oil gains twenty cents.

The Japanese PPI continues its slow grind higher, indicating more cost pressure to be read in the coming inflation. JGB yields opened lower on Tuesday while U.S. Treasury Yields are also trading lower. USD/JPY has recaptured the 150 handle but soon reversed traction along broad USD weakness to trade 0.12% lower at 149.51. Else, EUR/USD is up 0.06% and GBP/USD is up 0.09%.

North American session

Early equity weakness saw gains for the JPY and losses for the commodity currencies which reversed as equities recovered. USD/JPY was firm around 149.75 but USD/CAD saw a late spike above 1.4250 as Trump said tariffs against Canada and Mexico were going forward as scheduled in early March. AUD/USD was modestly weaker near .6350. EUR/USD saw early slippage to near 1.0450 before a modest recovery that did not get close to 1.05. 

The only data release was a weaker than expected Dallas Feb manufacturing survey, falling to -8.3 in February from a positive 14.1 in January.