The Japanese Yen is likely to continue higher while the Australian Dollar swoons as risk aversion grips financial markets after a disappointing BOJ policy announcement.
Talking Points
- Yen Soars, Aussie and Kiwi Dollars Tumble as Risk Aversion Grips FX Markets
- Bank of Japan Keeps Monetary Policy Unchanged, Ignores Recent Market Swings
- Risk Sentiment Swoon Likely to Continue with Little on Tap to Derail Momentum
The Japanese Yen soared while the Australian and New Zealand Dollars underperformed as risk aversion gripped financial markets in overnight trade. The MSCI Asia Pacific regional benchmark stock index fell 0.7 percent as the Bank of Japan opted to maintain its monetary policy stance unchanged, with the policy statement carrying no mention of recent market volatility much less any measures to address it. Traders seemed to be hoping for an increase in the size of ETF and J-REIT purchases and/or a change in funding terms to help stabilize asset prices.
European markets seem to be pressing ahead with risk-averse cues noted in Asia. USDJPY and AUDUSD accelerated lower anew, sinking alongside S&P 500 futures after a brief respite in late overnight trade as European bond trading came online at 6:00 GMT. The region’s stock exchanges have now joined in the selloff as well, trading down nearly 1 percent on average. A lackluster set of economic releases on tap in the US follows a quiet outing on the data front in Europe, suggesting there is relatively little out there to derail established momentum.
Capitalize on Shifts in Market Mood with the DailyFX Speculative Sentiment Index
Asia Session:
GMT |
CCY |
EVENT |
ACT |
EXP |
PREV |
23:50 |
JPY |
Japan Money Stock M3 (YoY) (MAY) |
2.8% |
2.8% |
2.6% |
23:50 |
JPY |
BSI Large All Industry (QoQ) (2Q) |
5.9 |
- |
1 |
23:50 |
JPY |
BSI Large Manufacturing (QoQ) (2Q) |
5.0 |
- |
-4.6 |
1:30 |
AUD |
Owner-Occupied Home Loan Value (MoM) (APR) |
-0.9% |
- |
5.1% |
1:30 |
AUD |
Home Loans (APR) |
0.8% |
2.0% |
4.8% |
1:30 |
AUD |
Investment Lending (APR) |
1.1% |
- |
1.4% |
1:30 |
AUD |
NAB Business Conditions (MAY) |
-4 |
- |
-6 |
1:30 |
AUD |
NAB Business Confidence (MAY) |
-1 |
- |
-1 |
2:48 |
JPY |
Bank of Japan Monetary Policy Announcement |
- |
- |
- |
5:45 |
SECO June 2013 Economic Forecasts |
- |
- |
- |
|
6:00 |
JPY |
Machine Tool Orders (YoY) (MAY P) |
-7.4% |
- |
-23.6% |
6:30 |
JPY |
BoJ Governor Kuroda Press Conference |
- |
- |
- |
Euro Session:
GMT |
CCY |
EVENT |
EXP/ACT |
PREV |
IMPACT |
8:30 |
Industrial Production (MoM) (APR) |
0.1% (A) |
0.7% |
Medium |
|
8:30 |
GBP |
Industrial Production (YoY) (APR) |
-0.6% (A) |
-1.4% |
Medium |
8:30 |
GBP |
Manufacturing Production (MoM) (APR) |
-0.2% (A) |
1.1% |
Low |
8:30 |
GBP |
Manufacturing Production (YoY) (APR) |
-0.5% (A) |
-1.4% |
Low |
9:00 |
EUR |
German Court Hearing on ESM |
- |
- |
Medium |
Critical Levels:
CCY |
SUPPORT |
RESISTANCE |
1.3201 |
1.3326 |
|
1.5516 |
1.5608 |
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak
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