Asia Summary and Highlights 9 Dec
RBA kept rate unchanged at 3.6%
Asia Session
The RBA has kept rate unchanged at 3.6% in the December meeting and does not seem to be signaling a cut in the February 2026 meeting either as they suggest risk to inflation is tilted to the upside. While this indicates we will not be seeing the last cut as per forecast in the coming few months, it is not the hawkish tilt certain market participants are anticipating. Such see the AUD/USD dipped on release before gradually recouping losses to trade 0.3% higher at 0.6644 as governor Bullock is more hawkish in her press conference suggesting a possible February hike if Q4 inflation jumps further. NZD/USD also dragged 0.19% higher while USD/CAD slips 0.07%.
On Tuesday, we are hearing Trump threatens Mexico tariffs due water treaty violations. It looks like the tariff man is back to action but so far the magnitude are not market moving yet, escalation of such is the one to watch out in the coming week. USD/JPY is trading 0.05% higher at 155.99. Else, EUR/USD and GBP/USD is up 0.09%.
North American session
JPY weakness, in part due to an earthquake in Japan and fears of consequent tsunamis, was the focus in North America. USD/JPY extended gains to near 156 from 155.50, while EUR/JPY advanced to 181.50 from 181.20. The USD was however generally firmer as were UST yields ahead of this week’s supply and FOMC meeting, EUR/USD slipping to 1.1625 from 1.1650 before recovering to 1.1640. EUR/CHF rose to .9390 from .9370 while EUR/GBP slipped to .8735 from .8750. AUD/USD slipped to .6620 from .6640 while USD/CAD rose to 1.3850 from 1.38.