Asia Summary and Highlights 29 July

Asia Session

We are beginning the week with a volatile morning with headlines crossing the wires and see USD opened broadly lower against major. USD/JPY reopened 30 pips lower than Friday close. But as the run to close the opening gap ran too far, USD/JPY is met with fierce offer to trade 160 pips lower. It seems a more hawkish expectations from the BoJ on Wednesday has kept JPY bids alive. Both the U.S. Treasury and JGB yields are lower and see USD/JPY trading 0.19% lower at 153.42.

Over the weekend, Hezbollah is named by Israel to be responsible for rocket attack at Golan Heights which killed twelve. Gold and Oil opened higher as market participants is concerned about escalation in the area. So far it does not seem to affect the equity space as both regional and U.S. three major equity indexes are trading higher. AUD/USD is up 0.09% but have erased most earlier gains, so as NZD/USD which is up 0.03%, while USD/CAD slipped 0.07% as oil almost up a dollar. Else, EUR/USD is up 0.05% and GBP/USD is up 0.07%.

North American session

UST yields and equities rallied as June core PCE prices came in on consensus at 0.2%, and slightly less before rounding. This did see USD/JPY slip to a low of 153.15 from 154.70 before recovering to 153.75 but EUR/USD was stable near 1.0860. GBP/USD dipped to 1.2350 before recovering to 1.2475. AUD/USD was stable but USD/CAD bounced from near 1.38 to see highs near 1.3850. 

Other US data saw personal income with a 0.2% increase while spending rose by 0.3%. Later the final July Michigan CSI was revised up to 66.4 from 66.0 as an upward revision h a 0.2% increase while spending rose by 0.3 to expectations outweighed a downgrade to current conditions.