Asia Summary and Highlights 14 Apr
Vance says progress made in Iran talks, sees path to broader deal
Asia Session
It is quite an interesting reversal overnight but we are not seeing major follow through in the Asia session so far, as market participants wait for the next trigger. Vance was being upbeat and say "progress made in Iran talks, sees path to broader deal". But that hasn't translated to strong U.S. equities performance, though regional ones are solid. AUD/USD is trading 0.1% lower at 0.7088. NZD/USD is trading 0.05% higher while USD/CAD slips 0.08%. Both Brent and WTI are lower.
JGB yields are rotating lower on Tuesday as we see broader market sentiment calmer. 2yr JGB yields have returned below 1.4%, 10yr close to 2.4% and 30yr around 3.6%. The softening USD also sees USD/JPY distance itself from 160 and is trading 0.2% lower at 159.10. Else, EUR/USD is up 0.07% and GBP/USD is up 0.08%.
European and North American sessions
The USD slipped back after its bounce seen on the failure of the weekend US-Iran peace talks, gradually in the European morning, with the USD losses gaining momentum in North America to leave it down on the day. Equities were resilient eventually building gains, with traders looking towards a standoff over the Strait of Hormuz as the US and Iran waited to see who could absorb more economic pain, rather than military escalation. The one US data release, a 3.6% fall in March existing home sales, was weaker than expected, but not a factor in the USD slide.
EUR/USD rebounded above 1.1750, a big figure from its Asian low, but lagged GBP/USD, which reached 1.35, while EUR/CHF gains were also erased. AUD/USD also advanced by a big figure to touch .71 while USD/CAD fell below 1.38, down a big figure. USD/JPY, after failing to test 160, slipped back to 159.35. EUR/JPY, after breaking above 187, got close to 187.50.