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13 Nov 2014
Recap: AUD sold on RBA intervention headline
FXStreet (Bali) - It was another low key affair in Asia, with the only notable moves seen in the Australian Dollar after a sporadic RBA headline regarding intervention, while the Yen market remained headline driven.
AUD/USD traded on a firmer tone towards 0.8730/35 offers up until RBA Assistant Governor Kent crossed the screens, saying the the CB has not ruled out intervention. While algos reacted in panic mode selling AUD, once digested, the comment wasn't anything earth-shattering as RBA's Governor Stevens has repeatedly said in recent comments that "currency intervention remains part of the RBA's toolkit even as the case for using hasn’t yet stacked up." AUD/USD saw a bounce towards 0.87 from 0.8675 support consequently.
USD/JPY remained in a tight range, with only one notable move mid Asia,in favour of Yen selling, when a headline (Jiji) showed that a LDP senior official ad said Abe has decided to call an election; which was not confirmed by other sources. USD/JPY initial strength into 105.85/90 faded with the market having being driven on a headline-by-headline basis until confirmation that a planned 2015 sales tax hike is to be delayed an additional 18 months, and that a snap election befoore year-end will be called. When/if confirmation is given, traders are likely to resume the Yen bear trend.
NZD/USD saw consolidation ahead of 0.7890/0.79 key resistance, which converges with a daily descending trendline connecting peaks from Oct 21, 29. EUR/USD was in 'paralysis mode' circa 1.2440/50, while GBP/USD traded in a slim range capped below 1.58 after the bleeding suffered post dovish BoE on Thursday.
Key headlines
NZ PMI prints highest result in 2014
New Zealand Food Price Index (MoM) climbed from previous -0.8% to 0% in October
Japan Machinery Orders (YoY) above forecasts (-1.3%) in September: Actual (7.3%)
Japan Machinery Orders (MoM) above forecasts (-1.9%) in September: Actual (2.9%)
Japan Domestic Corporate Goods Price Index (YoY) registered at 2.9%, below expectations (3.3%) in October
Japan Foreign investment in Japan stocks up to ¥1055.2B in November 7 from previous ¥904.7B
Japan Domestic Corporate Goods Price Index (MoM) came in at -0.8% below forecasts (-0.4%) in October
Japan Foreign bond investment: ¥1123.9B (November 7) vs ¥806.6B
United Kingdom RICS Housing Price Balance came in at 20% below forecasts (26%) in October
Australia Consumer Inflation Expectation up to 4.1% in October from previous 3.4%
New Zealand REINZ House Price Index (MoM): 1.4% (October) vs 0.2%
RBA Kent: High A$, mining investment, fiscal tightening to weigh on growth
NZ house prices ticking up in Oct
RBA's Kent: FX intervention not ruled out
Be careful to sell AUD on intervention headline
AUD/USD traded on a firmer tone towards 0.8730/35 offers up until RBA Assistant Governor Kent crossed the screens, saying the the CB has not ruled out intervention. While algos reacted in panic mode selling AUD, once digested, the comment wasn't anything earth-shattering as RBA's Governor Stevens has repeatedly said in recent comments that "currency intervention remains part of the RBA's toolkit even as the case for using hasn’t yet stacked up." AUD/USD saw a bounce towards 0.87 from 0.8675 support consequently.
USD/JPY remained in a tight range, with only one notable move mid Asia,in favour of Yen selling, when a headline (Jiji) showed that a LDP senior official ad said Abe has decided to call an election; which was not confirmed by other sources. USD/JPY initial strength into 105.85/90 faded with the market having being driven on a headline-by-headline basis until confirmation that a planned 2015 sales tax hike is to be delayed an additional 18 months, and that a snap election befoore year-end will be called. When/if confirmation is given, traders are likely to resume the Yen bear trend.
NZD/USD saw consolidation ahead of 0.7890/0.79 key resistance, which converges with a daily descending trendline connecting peaks from Oct 21, 29. EUR/USD was in 'paralysis mode' circa 1.2440/50, while GBP/USD traded in a slim range capped below 1.58 after the bleeding suffered post dovish BoE on Thursday.
Key headlines
NZ PMI prints highest result in 2014
New Zealand Food Price Index (MoM) climbed from previous -0.8% to 0% in October
Japan Machinery Orders (YoY) above forecasts (-1.3%) in September: Actual (7.3%)
Japan Machinery Orders (MoM) above forecasts (-1.9%) in September: Actual (2.9%)
Japan Domestic Corporate Goods Price Index (YoY) registered at 2.9%, below expectations (3.3%) in October
Japan Foreign investment in Japan stocks up to ¥1055.2B in November 7 from previous ¥904.7B
Japan Domestic Corporate Goods Price Index (MoM) came in at -0.8% below forecasts (-0.4%) in October
Japan Foreign bond investment: ¥1123.9B (November 7) vs ¥806.6B
United Kingdom RICS Housing Price Balance came in at 20% below forecasts (26%) in October
Australia Consumer Inflation Expectation up to 4.1% in October from previous 3.4%
New Zealand REINZ House Price Index (MoM): 1.4% (October) vs 0.2%
RBA Kent: High A$, mining investment, fiscal tightening to weigh on growth
NZ house prices ticking up in Oct
RBA's Kent: FX intervention not ruled out
Be careful to sell AUD on intervention headline