G20 and BoJ comments dominate FX markets
City Index February 15, 2013 2:02 PM
<p>NZD continues to trade from strength to strength, with stronger Q4 retail sales data taking the ‘bird’ above 0.8500. Retail sales came in at a […]</p>
NZD continues to trade from strength to strength, with stronger Q4 retail sales data taking the ‘bird’ above 0.8500. Retail sales came in at a robust 2.1% from an expected 1.4%.
JPY had a volatile session on Gotobi Day, which initially saw good fixing demand for USD/JPY but as soon as the flow passed, comments regarding BoJ Governor candidates and the G20 summit in Moscow this weekend pared back JPY weakness. EUR/JPY fell to levels not seen since January. The markets ignored comments from LDP minister Kozo Yamamoto that currency devaluation spurs growth and USD/JPY between 95-100 is appropriate, focusing instead on reports that PM Abe was close to selecting Toshiro Muto as BoJ Governor who is deemed by the market to support traditional QE measures rather than radical new policies. The consensus view is that PM Abe will make his decision on the BoJ head before his trip to the US.
Focus remains on the G20, with the WSJ reporting that a draft communiqué is being put together by the G20 that will include a general pledge for members to refrain from currency manipulation but they will not single out any particular country or currency. This comes despite calls from Russia to use “stronger and more specific language” on the need to avoid currency manipulation.
Data-wise today we get retail sales from the UK, with the US session bringing us Empire manufacturing, University of Michigan and TICS data.
Supports 1.3255-1.3230-1.3180 | Resistance 1.3400-1.3460-1.3520
Supports 92.20-91.80-91.40 | Resistance 93.15-93.80-94.45
Supports 1.5485-1.5455-1.5425 | Resistance 1.5545-1.5575-1.5640
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.