Asia Summary and Highlights 4 July
Australia May Trade Balance AUD 5773m, expected 6678m while both export and import improves.
Some U.S. politics fiasco
Japan M5.4 earthquake off Chiba prefecture
Asia Session
The Australia May Trade Balance came in lower than expectation of 6678m at AUD 5773m but both export and import are showing improvement from previous month with export being the strongest in nine months and import resume expansion. Both are positive signs for the Australian economy and seems to be supporting the Aussie. AUD/USD is trading 0.14% higher at 0.6714 despite mixed risk sentiment, NZD/USD is up 0.11% at 0.6110 while USD/CAD is unchanged.
USD/JPY has a partial correction earlier in the session as it traded as low as 161.14. But as Nikkei reached new highs, JPY was being pressured again to trade only 0.07% lower at 161.53 currently. 10yr JGB yields slipped lower amid the M5.4 earthquake off Chiba prefecture. There was some political fiasco in U.S. regarding Biden's commitment towards running and it is expected to be back and forth headlines till the real election data. Market reaction will have to wait until the end of Independence day holiday. Else, EUR/USD up 0.03% and GBP/USD is unchanged.
North American session
Slightly softer than expected labor market data, a 150k rise in June’s ADP estimate for private sector employment, and a 4k rise in initial claims to 238k, started a gradual USD decline, which accelerated on a sharply weaker than expected ISM services index of 48.8 from 53.8.
In the afternoon the USD drifted back to near levels seen before the release of ISM services data, but remained lower on the session. FOMC minutes, which saw the economy as cooling but saw little discussion of easing had little impact.
EUR/USD saw a brief move above 1.08 but ended near 1.0785. Most pairs saw similar moves, though USD/JPY, which saw a brief move below 161, saw a stronger recovery, ending near 161.70.