Yen Rallies on Narrowing Yield gaps, Dollar Recovering Slightly Elsewhere
| Action Insight Daily Report 1-13-23 |
Yen Rallies on Narrowing Yield gaps, Dollar Recovering Slightly Elsewhere |
While Dollar was sold off overnight, the decline was less severe than originally expected. Indeed, the greenback is currently just the second worst performer for the week, following Swiss Franc. The rally in commodity currencies was also less than convincing with Kiwi and Loonie as third and fourth weakest. Yen is currently the strongest, with help from narrowing yield gap. Euro, is next strongest while Sterling and Aussie are mixed. Technically, USD/JPY's break of 129.49 support indicates resumption of the decline from 151.39. Development in EUR/JPY and GBP/JPY also suggest that near term rebounds have completed, and retest of 137.37 and 155.33 could be seen next. Similarly, CAD/JPY could revisit 95.38 soon and AUD/JPY could follow and head back to 87.00. In Asia, at the time of writing, Nikkei is down -1.15%. Hong Kong HSI is flat. China Shanghai SSE is up 0.47%. Singapore Strait Times is up 0.27%. Japan 10-year JGB yield is up 0.008 at 0.513. Overnight, DOW rose 0.64%. S&P 500 rose 0.34%. NASDAQ rose 0.64%. 10-year yield dropped -0.105 to 3.449. |
USD/JPY Daily Outlook Daily Pivots: (S1) 127.96; (P) 130.24; (R1) 131.60; More... USD/JPY's decline from 151.93 resumed by breaking through 129.49 support. Intraday bias is back on the downside for 61.8% projection of 151.93 to 133.61 from 138.16 at 126.83 next. On the upside, above 131.29 minor resistance will turn intraday bias neutral first. But outlook will remain bearish as long as 134.76 resistance holds, in case of recovery. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 23:50 | JPY | Money Supply M2+CD Y/Y Dec | 2.90% | 3.30% | 3.10% | | 03:20 | CNY | Trade Balance (USD) Dec | 78.0B | 77.9B | 69.8B | | 03:20 | CNY | Exports (USD) Y/Y Dec | -9.90% | -10% | -8.70% | | 03:20 | CNY | Imports (USD) Y/Y Dec | -7.50% | -9.80% | -10.60% | | 03:20 | CNY | Trade Balance (CNY) Dec | 550B | 533B | 494B | | 03:20 | CNY | Exports (CNY) Y/Y Dec | -0.50% | 0.90% | | 03:20 | CNY | Imports (CNY) Y/Y Dec | 2.20% | -1.10% | | 07:00 | GBP | GDP M/M Nov | -0.30% | 0.50% | | 07:00 | GBP | Index of Services 3M/3M Nov | -0.40% | -0.10% | | 07:00 | GBP | Manufacturing Production M/M Nov | -0.20% | 0.70% | | 07:00 | GBP | Manufacturing Production Y/Y Nov | -5.20% | -4.60% | | 07:00 | GBP | Industrial Production Y/Y Nov | -2.80% | -2.40% | | 07:00 | GBP | Industrial Production M/M Nov | -0.10% | 0.00% | | 07:00 | GBP | Goods Trade Balance (GBP) Nov | -14.9B | -14.5B | | 09:00 | EUR | Italy Industrial Output M/M Nov | 0.40% | -1.00% | | 10:00 | EUR | Eurozone Trade Balance (EUR) Nov | -20.0B | -28.3B | | 10:00 | EUR | Eurozone Industrial Production M/M Nov | 0.60% | -2.00% | | 12:00 | GBP | NIESR GDP Estimate (3M) Dec | -0.30% | | 13:30 | USD | Import Price Index M/M Dec | -0.90% | -0.60% | | 15:00 | USD | Michigan Consumer Sentiment Index Jan P | 61.6 | 59.7 |
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