- Nikkei falls by 1.5% following NY lead and poor Japanese economic data
- Japan June core CPI -1.0% YoY
- Japanese unemployment rate rises slightly to 5.3%
- Japan’s June industrial output falls 1.5% MoM, well below expectations
- UK consumer confidence at 11 month low
- Japan’s MOF comment again on undesirability of strong JPY
One again a Friday trading session in Asia has been characterised by risk-off trading and stop-loss hunting. EUR/JPY was the main target in the latter, as heavy stops below 113.20 were triggered in early Tokyo trade. Poor Japanese economic data led to deeper falls on the Nikkei, after a negative start inspired by falls on Wall Street, and this led to risk-aversion in the FX market and further Yen buying. The MOF have hit the newswires towards the end of the session to try and jawbone the USD/JPY a bit higher.
EUR/JPY opened at 113.60 but the big stops below 113.20 were on all traders minds from the off. The initial push in Sydney/Wellington could not break below 113.30 but once Tokyo came in and the Nikkei started to fall, the stops were soon done. Ranges: EUR/JPY 112.64/113.69, USD/JPY 86.26/93
EUR/USD was primarily driven by EUR/JPY but there were also stops successfully targeted below 1.3055. Sovereign bids at 1.3050 halted the slide but the bounce has been negligible. Range: EUR/USD 1.3048/85, EUR/CHF 1.3564/1.3620
EUR/GBP was again very quiet in a 17 pip range and the GBP did not react to the consumer confidence data. Cable had one of its quietest sessions in a while, only seeing a 17 pip range like the cross. Ranges: Cable 1.5599/1.5616, EUR/GBP .8362/79.
The AUD was a big mover overnight and rumours of ever-increasing buyers hit the market. No sign of any big buying in the Asian session although more is touted for the London fix. Range: .8977/.9021
Markets: Nikkei -1.5%, HK -0.5%, All Ords -0.7%, Kospi -0.6%. Gold $1166/oz. Oil $77/bbl.
Have a great weekend all.