Back
30 Sep 2013
Session Recap: Risk off as appetizer on Italy, US shutdown
FXstreet.com (Barcelona) - The Japanese Yen was the winner in the Asian session, after aggressive 'flight to safety' bids stormed in along interbank trading, resulting on significant gap downs in all Yen crosses. The US Dollar also saw minor support against a weaker Euro, stronger advances seen vs the Aussie and Kiwi, both depressed, while failing to advance vs the Pound.
There were two focal points to start the week. Firstly, the Italian political paralysis after 5 government ministers from Berlusconi's party resigned over the weekend, leaving PM Letta's weak coalition even more vulnerable, potentially leading to a dissolution of parliament and new election having to be called. Secondly, a brief - for now - US government shutdown looks like a done deal.
In terms of data releases, a disappointing final read on the Chinese HSBC PMI, which came 1bp below its previous flash read - 50.2 vs 51.2 - saw the Australian Dollar take a contained hit, finding decent demand at 0.9280 support. Meanwhile, USD(JPY kept fluctuating below 98.00 after the level was lost at the open, while EUR/USD managed to return towards 1.35.
Overall, despite the wide gaps seen in Yen pairs, it was a session with slow price activity, with Asian traders seemingly only interested in month end FX flows. The equity market was dominated by the red colour, with the Nikkei down 1.8%, Shanghai the exception, up 0.55%, while Hang Seng Index was down 1.21%. In the US, the S&P 500 futures were down 0.85%.
Main headlines in Asia
Italian political crisis deepens
Risk aversion on Italy, US gvrt shutdown
Yen long the best trade this week?
Net USD specs flat, 1st time since Feb 2013 - HSBC
EUR/GBP: Major selling flows expected during European session
New Zealand Building Permits s.a. (MoM) increase to 1.54% in August from -3.4%
China's HSBC PMI 1 bp below flash reading, hold just above 50.00
Japan Industrial Production (MoM) declines to -0.7% in August from 3.4%
Potential impact of a US shutdown in the Greenback - Deutsche Bank
There were two focal points to start the week. Firstly, the Italian political paralysis after 5 government ministers from Berlusconi's party resigned over the weekend, leaving PM Letta's weak coalition even more vulnerable, potentially leading to a dissolution of parliament and new election having to be called. Secondly, a brief - for now - US government shutdown looks like a done deal.
In terms of data releases, a disappointing final read on the Chinese HSBC PMI, which came 1bp below its previous flash read - 50.2 vs 51.2 - saw the Australian Dollar take a contained hit, finding decent demand at 0.9280 support. Meanwhile, USD(JPY kept fluctuating below 98.00 after the level was lost at the open, while EUR/USD managed to return towards 1.35.
Overall, despite the wide gaps seen in Yen pairs, it was a session with slow price activity, with Asian traders seemingly only interested in month end FX flows. The equity market was dominated by the red colour, with the Nikkei down 1.8%, Shanghai the exception, up 0.55%, while Hang Seng Index was down 1.21%. In the US, the S&P 500 futures were down 0.85%.
Main headlines in Asia
Italian political crisis deepens
Risk aversion on Italy, US gvrt shutdown
Yen long the best trade this week?
Net USD specs flat, 1st time since Feb 2013 - HSBC
EUR/GBP: Major selling flows expected during European session
New Zealand Building Permits s.a. (MoM) increase to 1.54% in August from -3.4%
China's HSBC PMI 1 bp below flash reading, hold just above 50.00
Japan Industrial Production (MoM) declines to -0.7% in August from 3.4%
Potential impact of a US shutdown in the Greenback - Deutsche Bank