21 Jan 2015
Asia Recap: BoJ lifts Yen, NZD CPI knocks Kiwi down
FXStreet (Bali) - The Japanese Yen saw solid demand following the BoJ policy decision, ending as the top performing currency, while the NZ Dollar was the main laggard, after a lower-than-expected NZ CPI read for the fourth quarter of 2014.
USD/JPY saw a sharp slide to 117.66 from early 118.80 levels, gunning through stops below the 118.00 before stabilizing circa 117.80 ahead of the BoJ's Kuroda press conference. Volatility came in response to the BoJ policy outcome, with no change in QQE, while downgrading CPI and upgrading growth forecasts.
As Sean Lee, Founder at FXWW, notes: "Looks like short-term speccy mkt was mildly long USD/JPY hence the move back below 118.00 on the lack of BOJ action. There would seem to be plenty of demand on dips from more medium term players, with big banks issuing buy-dip recommendations yesterday. Technical support at prior hourly highs 117.75 seems to have attracted some of those buyers."
NZD/USD was another notable mover in Asia, with a new 3-week low printed on the back of a very subdued inflation report for Q4 2014 out of New Zealand. Mark Smith, Senior Economist at ANZ, said: "The news to us and the RBNZ is how benign core inflation readings have been despite the economy being well past the recovery stage. There is the growing likelihood there is a more persistent element to low inflation, which along with the stubbornly high NZD and fickle global scene should encourage the RBNZ to step away from the explicit tightening bias expressed in December."
AUD/USD found solid demand, initially having a brief drive through sub 0.8160 intraday support before a vigorous recovery topping out at 0.8220, with shallow dips seen, as the rate draws now a line in the sand above the 0.82 round number. EUR/USD showed some mild uptick action, moving from 1.1540 lows towards 1.1575, while the GBP/USD saw range-bound conditions between 1.5135 and 1.5172 ahead of the BoE minutes later in Europe.
Main headlines
Deflation hits New Zealand in Q4 2014
RBNZ to step away from explicit tightening bias - ANZ
Australia Westpac Consumer Confidence Index: 93.2 (January) vs 91.1
Australia Westpac Consumer Confidence: 2.4% (January) vs -5.7%
US State of the Union address: We turn the page on recession, wars
BoJ downgrades inflation forecast, more optimistic on growth
Japan Coincident Index declined to 109.2 in November from previous 109.9
05:02 GMTJapan Leading Economic Index declined to 103.9 in November from previous 104.5
USD/JPY saw a sharp slide to 117.66 from early 118.80 levels, gunning through stops below the 118.00 before stabilizing circa 117.80 ahead of the BoJ's Kuroda press conference. Volatility came in response to the BoJ policy outcome, with no change in QQE, while downgrading CPI and upgrading growth forecasts.
As Sean Lee, Founder at FXWW, notes: "Looks like short-term speccy mkt was mildly long USD/JPY hence the move back below 118.00 on the lack of BOJ action. There would seem to be plenty of demand on dips from more medium term players, with big banks issuing buy-dip recommendations yesterday. Technical support at prior hourly highs 117.75 seems to have attracted some of those buyers."
NZD/USD was another notable mover in Asia, with a new 3-week low printed on the back of a very subdued inflation report for Q4 2014 out of New Zealand. Mark Smith, Senior Economist at ANZ, said: "The news to us and the RBNZ is how benign core inflation readings have been despite the economy being well past the recovery stage. There is the growing likelihood there is a more persistent element to low inflation, which along with the stubbornly high NZD and fickle global scene should encourage the RBNZ to step away from the explicit tightening bias expressed in December."
AUD/USD found solid demand, initially having a brief drive through sub 0.8160 intraday support before a vigorous recovery topping out at 0.8220, with shallow dips seen, as the rate draws now a line in the sand above the 0.82 round number. EUR/USD showed some mild uptick action, moving from 1.1540 lows towards 1.1575, while the GBP/USD saw range-bound conditions between 1.5135 and 1.5172 ahead of the BoE minutes later in Europe.
Main headlines
Deflation hits New Zealand in Q4 2014
RBNZ to step away from explicit tightening bias - ANZ
Australia Westpac Consumer Confidence Index: 93.2 (January) vs 91.1
Australia Westpac Consumer Confidence: 2.4% (January) vs -5.7%
US State of the Union address: We turn the page on recession, wars
BoJ downgrades inflation forecast, more optimistic on growth
Japan Coincident Index declined to 109.2 in November from previous 109.9
05:02 GMTJapan Leading Economic Index declined to 103.9 in November from previous 104.5