A much stronger than expected Australian employment report gave AUDUSD 70 pips of upside overnight. 44k new jobs were created against expectations of only 6.5k, and the unemployment rate held steady at 5.2% despite fears it would tick higher. Continue reading →

The dollar had a surprise recovery overnight, and quickly reclaimed all ground lost to the euro after Friday’s weak US payrolls. However, flows were light as New Zealand, Australia, and Hong Kong remained closed. A stronger-than-expected China CPI failed to generate much interest, and allowed AUDUSD to take the news largely in its stride. Continue reading →

Subdued trading in Asia meant EURUSD was confined to a 25-pip range. The price action in USDJPY and AUDUSD was somewhat more lively, but flows were light across the board in pre-holiday trade. Newswires would have been mostly silent were it not for Japan’s Finance Minister Azumi defending his intervention policy. Continue reading →

Australia chalked up a second consecutive trade deficit in February triggering a 30 pip drop in AUDUSD. Losses could have been greater had a technical support line not made its presence felt. The consensus had been looking for a rebound back into surplus territory, as the effects of the Lunar New Year holiday were expected to have worn off by now. Continue reading →

The RBA held the cash rate at 4.25%, in line with expectations. The rates market had 8bp of easing priced in, and AUDUSD jumped 20 pips immediately. The more dovish policy statement quickly put an end to the rally and the pair soon dropped 40 pips below its pre-announcement level. Growth was deemed to be “somewhat below trend” and “somewhat lower than earlier estimated”. This represents a significant shift from the “close to trend” language used previously. Continue reading →

China’s official manufacturing PMI released over the weekend came in at 53.1 (cons. 50.8), substantially beating consensus opinion. The Australian dollar was the main beneficiary and climbed over 100 pips at the Asia open, although the rally eventually lost some steam after a very weak Australian building approvals report. Continue reading →

Price action in Asia was dominated by month-end and quarter-end flows into the Tokyo fix, on this the last day of Japan’s fiscal year. The euro, and Australian and New Zealand dollars received a boost, but USDJPY remains heavy as UST yields continue to drift lower. Continue reading →

The Australian dollar struggled through the overnight session, weighed down by lingering concern over how severe the slowdown in China could become. A McCrann article in the Australian press added to the selling pressure, claiming that a cut to the RBA’s cash rate at next Tuesday’s meeting is actually more likely than not. Continue reading →

The lack of any economic data releases overnight allowed the US dollar to get back on its feet and reclaim some lost ground. Still tempering the US dollar’s upside is the cautious stance of Fed Chairman Bernanke, who said in a transcript of an impending television interview that “it’s far too early to declare victory” and while “the recent news has been good&I think we need to be cautious and make sure this is sustainable”. Continue reading →

Those hoping for less dovish commentary from Fed Chair Bernanke were mostly disappointed. Although he acknowledged the recent “genuine improvement” in the labour market, he again emphasised that the situation is still “far from normal”. What hurt the dollar most was Bernanke’s view that “continued accommodative policies” could help boost employment. Continue reading →

The last week of Japan’s fiscal year got underway overnight, and anticipation is already building that the crossover to the new year will prompt a resumption of the five-week-old USDJPY rally. Continue reading →