21 Jul 2015
Aussie sold-off on RBA minutes, a data-light EUR calendar ahead
FXStreet (Mumbai) - The RBA minutes revealed that the RBA board members talked down on the exchange rate which exerted renewed pressure on the Aussie in Asia trading. On the other hand, BOJ minutes offered no fresh incentives on the Japanese yen, with USD/JPY hovering near one-month highs at 124.40. Kiwi was the best performer, staging a solid come back from six-year lows and is seen struggling around 0.6600 levels.
Key headlines in Asia
BoJ minutes: Underlying trend in inflation to improve
RBA minutes: Steady rates appropriate, outlook data-dependent
Gold bears in control, struggling around $ 1100
Dominating themes in Asia - centered on JPY, AUD, NZD
Central banks’ minutes dominated Asia with RBA minutes weighing on Aussie, dragging AUD/USD towards 0.7350 levels. RBA minutes read, "Members noted that the exchange rate had thus far offered less assistance than would normally be expected in achieving balanced growth in the economy and that further depreciation seemed both likely and necessary." The Aussie also remains undermined on falling gold prices which struggles near fresh five year lows around $ 1100 in Asia.
While the Kiwi was boosted by the country's Prime Minister John Key comments delivered on Monday, citing that the recent fall in the currency may have gone too far. Also profit-taking spree after the recent slump to six year lows below 0.65 handle also supported the recovery in NZD/USD towards 0.6600 levels.
The dollar-yen pair is sitting near fresh monthly highs near 124.41 largely underpinned by Fed rate hike bets which is US dollar positive amid recent talks over rate-lift as early as this Sept by Fed officials. EUR/USD is breaking lower towards 1.08 marker with USD bulls jumping back into the bids ahead of Europe open.
Asian markets are trading mostly mixed, with China stocks recovering losses and turned into green. The Shanghai composite index now trades nearly +0.30% at 4002. The Nikkei 225 in Tokyo advances 0.58%, while Australian benchmark the ASX 200 trades 0.43% higher around 5700. South Korea’s Kospi trades flat at 2072.
Heading into Europe - centered on EUR, GBP
A data light EUR calendar ahead, with only couple of two-tier data in Swiss Trade balance and UK Public Sector Net Borrowing to be reported.
Looking ahead, we have an empty macro-calendar during the New York session, with markets now shifting their focus towards Wednesday’s Australia’s CPI data along with RBA Stevens speech and BOE monetary policy meeting. While RBNZ cash rate decision due on Thursday is also highly anticipated.
EUR/USD Technicals
Research Team at AceTrader notes, " Euro's brief break of daily key support at 1.0819 (May) to 1.0808 near New York close confirms early erratic fall from 1.1467 (May top) has finally resumed and further weakness to next daily chart objective at 1.0785 would be seen. However, near term loss of momentum should keep euro above 1.0700/10 today and bring correction later. Expect 1.0870/73 (yesterday's high, and previous support, now resistance) to hold and yield aforesaid decline and only above 1.0907 (Friday high) would dampen bearishness, risk 1.0926/30."
Key headlines in Asia
BoJ minutes: Underlying trend in inflation to improve
RBA minutes: Steady rates appropriate, outlook data-dependent
Gold bears in control, struggling around $ 1100
Dominating themes in Asia - centered on JPY, AUD, NZD
Central banks’ minutes dominated Asia with RBA minutes weighing on Aussie, dragging AUD/USD towards 0.7350 levels. RBA minutes read, "Members noted that the exchange rate had thus far offered less assistance than would normally be expected in achieving balanced growth in the economy and that further depreciation seemed both likely and necessary." The Aussie also remains undermined on falling gold prices which struggles near fresh five year lows around $ 1100 in Asia.
While the Kiwi was boosted by the country's Prime Minister John Key comments delivered on Monday, citing that the recent fall in the currency may have gone too far. Also profit-taking spree after the recent slump to six year lows below 0.65 handle also supported the recovery in NZD/USD towards 0.6600 levels.
The dollar-yen pair is sitting near fresh monthly highs near 124.41 largely underpinned by Fed rate hike bets which is US dollar positive amid recent talks over rate-lift as early as this Sept by Fed officials. EUR/USD is breaking lower towards 1.08 marker with USD bulls jumping back into the bids ahead of Europe open.
Asian markets are trading mostly mixed, with China stocks recovering losses and turned into green. The Shanghai composite index now trades nearly +0.30% at 4002. The Nikkei 225 in Tokyo advances 0.58%, while Australian benchmark the ASX 200 trades 0.43% higher around 5700. South Korea’s Kospi trades flat at 2072.
Heading into Europe - centered on EUR, GBP
A data light EUR calendar ahead, with only couple of two-tier data in Swiss Trade balance and UK Public Sector Net Borrowing to be reported.
Looking ahead, we have an empty macro-calendar during the New York session, with markets now shifting their focus towards Wednesday’s Australia’s CPI data along with RBA Stevens speech and BOE monetary policy meeting. While RBNZ cash rate decision due on Thursday is also highly anticipated.
EUR/USD Technicals
Research Team at AceTrader notes, " Euro's brief break of daily key support at 1.0819 (May) to 1.0808 near New York close confirms early erratic fall from 1.1467 (May top) has finally resumed and further weakness to next daily chart objective at 1.0785 would be seen. However, near term loss of momentum should keep euro above 1.0700/10 today and bring correction later. Expect 1.0870/73 (yesterday's high, and previous support, now resistance) to hold and yield aforesaid decline and only above 1.0907 (Friday high) would dampen bearishness, risk 1.0926/30."