Asia Summary and Highlights 12 August

Asia Session

The USD is opening broadly higher on Monday and see major USD pairs opened with a gap in favor of the greenback which is all closed. Over the weekend, Israel was placed on High Alert as indications suggesting imminent Iran attack and US Abraham Lincoln Carrier Strike Group accelerating towards Middle East. It seems to be the retaliation from the previous assassination by Israel. The broad risk space does not seem to be bothered with major equity indexes in the green. AUD/USD has closed the minor opening gap and is trading 0.15% higher at 0.6581, NZD/USD is trading 0.21% higher at 0.6012 while USD/CAD is 0.04% higher at 1.3731.

USD/JPY continue to consolidate after the recent drop and rebounds higher to above 147 figure. Ex-Bank of Japan monetary policy board member Sakurai says he thought the Bank would be unable to hike again this year due to market volatility and the low likelihood of a rapid economic recovery. It is similar to our central forecast and is driving the USD/JPY higher for the session. USD/JPY is trading 0.37% higher at 147.14. EUR/USD is up 0.05% and GBP/USD is 0.06% higher.

North American session

In a quiet session USD/JPY saw an early dip to a low of 146.27 from around 147 before correcting back above 146.50. EUR/USD was confined to a tight range around 1.0920. GBP/USD was slightly more volatile, bottoming at 1.2726 before peaking at 1.2774, but ended little changed near 1.2760.

The only significant data as an unexpected 2.8k decline in July Canadian employment, though the unemployment rate remained unchanged at 6.4%. USD/CAD slipped to 1.3730 from 1.3745 despite the weak data while AUD/USD was little changed near .6575, sustaining European losses.