Asia Summary and Highlights 21 August
Potential candidate for Japan PM, Katsunobu Kato, supports BOJ continuing to hike rates
Japan July exports +10.3% y/y & imports +16.6% y/y
USD rebounds slightly after three red days in a row
Asia session
The July Japan trade data shows positive signs for the Japanese economy. While export only grew at 10.3% y/y, import jumped to 16.6% y/y in July. It would be welcoming for the BoJ as consumption has been a huge drag towards Japanese economics growth in the past two quarters. The potential candidate for Japan PM, Katsunobu Kato, has remark supporting BOJ's continue rate hike but has little impact in the market as BoJ's stance in the latest meeting is already hawkish. USD/JPY is trading 0.25% higher on broad USD strength for U.S. Treasury Yields outperform JGB yields.
USD rebounds slightly on Wednesday Asia after three red days in a row, along circa 0.1% gains in 2/10yr U.S. Treasury Yields. Regional sentiment are broadly soft while U.S. three major equity indexes' toes in the green. Major FX pairs are little changed with Kiwi leading the losses against the USD. NZD/USD is down 0.2% at 0.6141, AUD/USD slipped 2 pips to 0.6744while USD/CAD fell 0.06%. Else, EUR/USD is down 0.09% and GBP/USD is down 0.04%.