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9 Sep 2015
Kiwi flies in Asia ahead of RBNZ, a set of UK data eyed
FXStreet (Mumbai) - Absolute dominance of risk-sentiment during the Asian session increased bids for higher yielding currencies such as the Antipodeans and USD. While, Asian traders enjoyed solid gains on the stocks on their local bourses, which benefitted the most from the persisting risk-on flows.
Key headlines in Asia
Australia's Westpac consumer confidence collapses in Sept
Nikkei drives Asian markets through the roof
RBA's Lowe: Lower AUD helping economy in current downswing
Dominating themes in Asia - centered on JPY, AUD, NZD
An eventful Asian session, with Asian stocks on a roll to the upside boosted by an improving appetite for riskier assets such as higher yielding currencies and commodities.
The Japanese yen was the biggest loser in Asia as a better sentiment towards the greenback crippled the safe-haven appeal of the Japanese currency. USD/JPY remains strongly bid above 120 handle with the bulls fighting hard to break above 120.50 levels.
On the other hand, the Antipodeans were the biggest beneficiaries of the risk environment with their respective fundamentals adding further to their strength. The Aussie kept its winning streak intact and rallied to 0.7070 highs beyond hourly 200-DMA despite a miss on the consumer confidence numbers as the positive comments from RBA Lowe overshadowed the dismal data.
The Westpac-Melbourne Institute Consumer Sentiment Index tumbled 5.6% to 93.9 points in September from 99.5 in August. While, RBA Lowe talked up the domestic currency stating that lower AUD is helping economy to spur growth in the currency volatile global scenario. He also added, “Movements in China stock market likely to have only limited impact on overall Chinese economy.”
While the Kiwi also tracks the Aussie higher and trades firmly beyond 0.6375 levels ahead of the Reserve Bank of New Zealand (RBNZ) cash-rate announcement and Monetary Policy Statement on Thursday, which is widely expected to see the central bank cut interest rates.
Meanwhile, the Asian markets rallied on Wednesday tracking positive cues from the US markets overnight with the Japan’s benchmark index, the Nikkei, main driver now gaining almost 6% at 18,436. While the Hong Kong's benchmark Hang Seng index trades 2.83% up at 21,861 and the Shanghai Composite extends gains by 1.69% at 3224. While Korea's benchmark Kospi index advances 2.25% at 1,920 points in Seoul. The benchmark Australian S&P/ASX 200 also rocketed over 1.6% to 5,199.
Heading into Europe - centered on EUR, GBP
The coming week will be occupied by waiting for these events, as the glimpse on the macro calendar reveals only some low-profile prints.
A better lit European session ahead, with few macro releases to be reported with the main focus will be on the industrial production and trade balance data from the UK.
Wednesday brings more important figures in the form of the UK manufacturing production print. The headline gauge is expected to have stayed intact in July at a 0.2% and 0.5% growth on a monthly and annual basis, respectively.
Looking ahead, we have an eventful NA session as well with Bank of Canada (BOC) rate decision the main highlight besides a set of housing data from Canada.
From the US calendar, only JOLTS Job Openings will provide some insights amid a data-dry week ahead for the US traders. While Wall Street cues will also be closely monitored.
EUR/USD Technicals
The AceTrader Team notes, “Despite euro's selloff to 1.1090 in volatile trading session following the release of mixed U.S. jobs report, subsequent rebound to 1.1229 yesterday suggests further choppy trading above last Thursday's low at 1.1087 would continue with mild upside bias and gain towards 1.1239/40 would be seen. However, resistance at 1.1294 should remain intact this week and bring another retreat later.”
“On the downside, only below 1.1087 would revive bearishness for a resumption of recent decline and extend weakness towards 1.1050/52.”
Key headlines in Asia
Australia's Westpac consumer confidence collapses in Sept
Nikkei drives Asian markets through the roof
RBA's Lowe: Lower AUD helping economy in current downswing
Dominating themes in Asia - centered on JPY, AUD, NZD
An eventful Asian session, with Asian stocks on a roll to the upside boosted by an improving appetite for riskier assets such as higher yielding currencies and commodities.
The Japanese yen was the biggest loser in Asia as a better sentiment towards the greenback crippled the safe-haven appeal of the Japanese currency. USD/JPY remains strongly bid above 120 handle with the bulls fighting hard to break above 120.50 levels.
On the other hand, the Antipodeans were the biggest beneficiaries of the risk environment with their respective fundamentals adding further to their strength. The Aussie kept its winning streak intact and rallied to 0.7070 highs beyond hourly 200-DMA despite a miss on the consumer confidence numbers as the positive comments from RBA Lowe overshadowed the dismal data.
The Westpac-Melbourne Institute Consumer Sentiment Index tumbled 5.6% to 93.9 points in September from 99.5 in August. While, RBA Lowe talked up the domestic currency stating that lower AUD is helping economy to spur growth in the currency volatile global scenario. He also added, “Movements in China stock market likely to have only limited impact on overall Chinese economy.”
While the Kiwi also tracks the Aussie higher and trades firmly beyond 0.6375 levels ahead of the Reserve Bank of New Zealand (RBNZ) cash-rate announcement and Monetary Policy Statement on Thursday, which is widely expected to see the central bank cut interest rates.
Meanwhile, the Asian markets rallied on Wednesday tracking positive cues from the US markets overnight with the Japan’s benchmark index, the Nikkei, main driver now gaining almost 6% at 18,436. While the Hong Kong's benchmark Hang Seng index trades 2.83% up at 21,861 and the Shanghai Composite extends gains by 1.69% at 3224. While Korea's benchmark Kospi index advances 2.25% at 1,920 points in Seoul. The benchmark Australian S&P/ASX 200 also rocketed over 1.6% to 5,199.
Heading into Europe - centered on EUR, GBP
The coming week will be occupied by waiting for these events, as the glimpse on the macro calendar reveals only some low-profile prints.
A better lit European session ahead, with few macro releases to be reported with the main focus will be on the industrial production and trade balance data from the UK.
Wednesday brings more important figures in the form of the UK manufacturing production print. The headline gauge is expected to have stayed intact in July at a 0.2% and 0.5% growth on a monthly and annual basis, respectively.
Looking ahead, we have an eventful NA session as well with Bank of Canada (BOC) rate decision the main highlight besides a set of housing data from Canada.
From the US calendar, only JOLTS Job Openings will provide some insights amid a data-dry week ahead for the US traders. While Wall Street cues will also be closely monitored.
EUR/USD Technicals
The AceTrader Team notes, “Despite euro's selloff to 1.1090 in volatile trading session following the release of mixed U.S. jobs report, subsequent rebound to 1.1229 yesterday suggests further choppy trading above last Thursday's low at 1.1087 would continue with mild upside bias and gain towards 1.1239/40 would be seen. However, resistance at 1.1294 should remain intact this week and bring another retreat later.”
“On the downside, only below 1.1087 would revive bearishness for a resumption of recent decline and extend weakness towards 1.1050/52.”