Europe Summary and Highlights 4 December
The JPY was generally stronger through the European morning, with USD/JPY down 50 pips to 154.75, and EUR/JPY down 50 pips to 1.8055.
European morning session
The JPY was generally stronger through the European morning, with USD/JPY down 50 pips to 154.75, and EUR/JPY down 50 pips to 1.8055. The USD was slightly softer against most European currencies, but little changed against the AUD and CAD. The scandis were a little weaker against the EUR and little changed against the USD after Swedish preliminary November CPI came out weaker than expected at 2.3% y/y on the targeted CPIF measure.
Other data included a very weak UK construction PMI number for November, the weakest on record excluding the pandemic, and Eurozone retail sales, which was flat on the month as expected in October.
Asia session
We are hearing more from Japan's Chief Cabinet Secretary Kihara that he is concerned over rapid, one-sided yen moves. It is a continuous attempt in verbal intervention despite JPY retreats from recent low. With the December BoJ meeting in sight, very likely market participants will be careful in placing their position. USD/JPY is trading 0.18% higher at 155.48. The 30yr JGB received the highest bid-to-cover since 2019, suggest strong demand for long term JGBs.
The Australian trade balance beats estimate at AUD4385mn for October. Both import and export is positive m/m. At the same time, household spending stays solid at 5.6% y/y. Neither favors an imminent cut from the RBA. Regional equities are outperforming U.S. major equity indexes so far on Thursday. AUD/USD is trading 0.11% higher at 0.6608, NZD/USD is trading 0.07% lower while USD/CAD rises 0.08%. Else, EUR/USD is up 0.1% and GBP/USD is up 0.13%.