Asia Summary and Highlights 6 March

Asia Session

The trade war has officially begun but market participants are so far taking it easy as both sides are exchanging softer comment. With Trump's negotiation tactic, it should not be surprising to see abrupt changes to his policy. Risk asset looks calm with the regional equities upbeat. The strength in regional equities seems to be trigger by China released another AI Agent, Manus, which claims it is outperforming OpenAI. AUD/USD is up 0.29% to 0.6354, NZD/USD is up 0.18% and USD/CAD slips 0,07%.

USD/JPY has recaptured 149 figure as tariff headlines crossing the wire are on the soft side. The White House announced a one-month tariff reprieve for auto imports from Mexico and Canada in late NA session, which seems to be the catalyst for a calmer tone in the market. Both the U.S. Treasury and JGB yields are higher in the session, 10yr JGB yields have broke 1.5%. USD/JPY is trading 0.19% higher at 149.13. Else, EUR/USD is up 0.12% and GBP/USD unchanged.

North American session

EUR/USD extended its European gains to 1.0795, while EUR/GBP advanced to .8370 as GBP/USD tested 1.29. AUD/USD was also firm, near .6340. A one-month postponement of US tariffs on Canadian and Mexican autos saw USD/CAD fall to 1.4340, almost a big figure below the session high.  

US ADP employment data was weaker than expected with a 77k increase but the impact of this on the UST market was largely erased by a stronger than expected ISM services index of 53.5. ADP data helped USD/JPY fall to lows below 148.50, with a subsequent correction unable to hold above 149 despite the firmer ISM services data and rally in equities on the auto tariff postponement.