FX Daily Planet: London Open

FX Daily Planet: London Open

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Asian equity markets started on a weak note, following a decline in stocks in the US afternoon session on Wednesday. However, Asian equities eventually started showing resilience and have recovered a positive territory. With the firm tone in the equity markets, currency markets showed a typical price pattern seen in the time of improved investors’ risk appetites; JPY became the weakest currency followed by USD while high-betas outperformed. Larger-than-consensus April trade surplus in New Zealand provided an additional support for NZD while the market remained indifferent to a weaker-than-consensus 1Q capex in Australia. USD/Asia broadly traded lower with KRW, which had been the main underperformer in the first half of this week, outperformed the most in EM Asia, rising 2% against USD. Another notable move was seen in 12-month USD/CNY NDFs, which dropped 0.6% on PBoC’s second straight hike in the auction yield for 3-month bills.

In the London session, the developments in stock markets and government bonds in the European peripherals should lead a general market trend. In addition to them, INSEE consumer sentiment from France and ISAE business confidence from Italy will be worth watching though economic releases have been taking a back seat, as some weak survey figures in European countries released yesterday suggested the possibility that current market turmoil has started negatively affecting

ENDS

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