1. Hello Guest Do you know binary.com offers exclusive $20 No Deposit Bonus for FX Binary Point visitors? Click here to sign up

Yen volatile post-BOJ, Kuroda presser, EU CPI – Up Next

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Oct 30, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Joined:
    Oct 7, 2015
    Messages:
    27,524
    Likes Received:
    0
    FXStreet (Mumbai) - Finally the much-awaited BOJ policy decision was announced earlier in Asia, with markets disappointed as BOJ eventless yet again. While the Japanese currency experienced wild swings on both sides following BOJ’s on-hold policy stance. The Antipodeans staged a solid comeback from the previous slump, despite the ongoing divergent policy outlooks.

    Key headlines in Asia

    BOJ leaves policy unchanged

    BOJ out of the way, Kuroda presser up next

    Dominating themes in Asia - centered on JPY, AUD, NZD

    Markets shrugged off the economic releases across the Asia-pac regions as the main market mover during this session emerged the BOJ policy decision. The BOJ made no changes to its monetary policy and continued with its pledge to increase monetary base at annual pace Of 80 trln yen. The status-quo maintained by the BOJ today squashed market expectations of further easing, thus boosting the sentiment around the Japanese currency in a knee-jerk reaction.

    However, the USD/JPY bulls quickly regained ground, driving the major beyond post-FOMC highs near 120.40, as markets turned attention towards the BOJ semi-annual outlook report expected to be published at 6GMT. The central bank is expected to downgrade the assessment of Japan’s CPI and GDP forecasts, thus weighing heavily on the yen.

    While the Antipodes rebounded sharply higher, with the Kiwi gaining the most on the back of a strong jump in the NZ business confidence outlook as reported by ANZ. While the Aussie towed-in and extended higher on the back of recovery in the commodities space. While markets also cheered upbeat Aus factory gate prices data, with the PPI rising 0.9% in Sept quarter against a 0.3% rise expected. While Australian private sector credit also came in better than expected at 0.8% (0.5% expected). AUD/USD rallies 0.37% to 0.7100, while the Kiwi flies 0.60% to 0.6733.

    On the equities space, the Asian stocks trade mixed, with the Japanese stocking rebounding higher as markets continue to digest the latest BOJ policy decision. The Nikkei is rallying 1.04% to 19,140. Australia’s S&P ASX index drops -0.54% to 5,239. While China’s A50 index gains 0.39% to 10,058. Hong Kong’s Hang Seng turns positive to 22,857.

    Heading into Europe & the US

    BOJ Kuroda’s press conference is likely to kick-start a data-heavy European session, with all eyes on the German retail sales and the Euro zone flash CPI estimate and labor market report.

    Germany will report the results of retail sales in September, with a 0.4% gain forecast on a monthly basis, following the 0.4% drop in August, and a 3.4% hike annually after advancing 2.5% y/y a month ago.

    The euro zone will publish its October inflation data estimate, with inflation expected to register a flat 0.0% result year-on-year. In September, consumer price growth in the euro zone reached a negative 0.1% annual level.

    While the rate of registered unemployed in the region was 11.0% in August, and is expected to remain at the same level.

    Looking towards the NA session, we have an eventful macro calendar with the Fed’s most preferred inflation gauge to hog the limelight. While personal spending, Chicago PMI, UoM consumer sentiment and employment cost index will be also published. The core PCE inflation rate is expected to decline, slipping to 1.4% from the previous 1.9%.

    Besides, FOMC member Williams is scheduled to deliver a speech in Washington.

    EUR/USD Technicals

    Valeria Bednarik, Chief Analyst at FXStreet explained, “The short term picture however, is far from supporting additional gains, as in the 1 hour chart, the technical indicators have turned flat after recovering above their mid-lines, whilst the price remains well below a bearish 100 SMA. In the 4 hours chart, the technical indicators are heading slightly lower well into negative territory, while the 20 SMA maintains its bearish tone, offering an immediate resistance around 1.1015. Being the last day of the month, investors may take some profits out of the table this Friday although sellers will likely add at higher levels.”
    For more information, read our latest forex news.
     

Share This Page