Asia Summary and Highlights 21 Mar

Asia Session

After two dismal jobs reports, the February Australian employment data has shown a great rebound. Headline employment change is an increase of 116.5k, unemployment rate dropped to 3.7% while participation rate also slipped by 0.1%. With full time unemployment taking a big chunk of headline changes, it is a great job report and is supporting the Aussie. AUD/USD is trading 0.54% higher at 0.6622, NZD/USD is 0.23% higher at 0.6095 while USD/CAD is 0.19% lower as oil retrace some of the overnight losses.

The USD slumped as the FOMC dots plot did not signal less easing in 2024. Ueda's remark does not provide any clarity in the future path of BoJ and we do have some verbal intervention from Japanese cabinet officials but I doubt they have swayed the course in USD/JPY.With USD broadly weaker, USD/JPY corrected from highs to trade 0.32% lower at 150.76 with a session low at 150.27. Elsewhere, EUR/USD is 0.12% higher and GBP/USD is 0.03% higher.

North American session

The USD reversed European gains heading into the FOMC, with no significant data released, with EUR, GBP and AUD back to near European opening levels. CAD outperformed a touch, largely before BoC minutes from March 6 showed little urgency to cut rates, while USD/JPY saw little change.

The USD slipped on the FOMC announcement where the statement was little changed and the 2024 dots still showed 75bps of easing, though with the 2025 dots showing 75bps rather than 100bps of easing the initial USD losses faded before Powell’s press conference began. Powell gave few hawkish signals, notably still seeing a declining trend in inflation despite the January and February disappointments, and the USD saw renewed slippage. USD/JPY saw lows below 151 before a modest correction while EUR/USD rose to 1.0920 with no significant correction, with GBP, AUD and CAD all showing similar moves.