Yen Staying Soft on Rising US Yields, Aussie Vulnerable to Further Declines Ahead of RBA Minutes
| Action Insight Mid-Day Report 11-18-24 |
Yen Staying Soft on Rising US Yields, Aussie Vulnerable to Further Declines Ahead of RBA Minutes |
The forex markets are largely consolidating today, with no major developments to drive decisive moves. Euro is showing some recovery, but the uptick appears more like a corrective bounce than a reversal. Sterling and Swiss Franc are following similar patterns, with modest strength lacking the momentum needed for sustained gains. This cautious tone is evident in the tight trading ranges of EUR/USD, GBP/USD, and USD/CHF, as traders await key events, including Wednesday's UK CPI release, and Eurozone and UK PMI data on Friday. Yen, however, is under mounting pressure as the European session progresses. Rising treasury yields in the US are acting as a headwind, with US 10-year yield once again eyeing the 4.5% mark. Compounding Yen's challenges is the absence of clear signals from BoJ regarding its next policy move. With no explicit guidance on a December rate hike, market participants are increasingly skeptical of imminent monetary tightening. Despite this, Yen remains sensitive to risk sentiment, meaning it could stage a rebound if US equity markets face renewed sell-offs. Focus will soon turn to RBA meeting minutes, set for release during the upcoming Asian session. Earlier this month, RBA left its cash rate unchanged at 4.35% but caught markets off guard by maintaining a strongly vigilant stance on upside inflation risks. NAB, one of Australia’s largest banks, has already revised its forecast for the first rate cut, pushing the timeline from February to May 2025. The minutes will be closely analyzed to gauge whether February remains a realistic window for RBA’s initial easing move or if the central bank is preparing for a longer wait.... |
USD/JPY Mid-Day Outlook Daily Pivots: (S1) 153.18; (P) 154.97; (R1) 156.07; More... Intraday bias in USD/JPY remains neutral for the moment. Another rise is in favor as long as 153.87 resistance turned support holds. Break of 156.74 will resume the rally from 139.57 towards 161.91 high. However, firm break of 153.87 and the near term rising channel would confirm short term topping. In this case, intraday bias will turn back to the downside for 151.27 support, or even further to 38.2% retracement of 139.57 to 156.74 at 150.18. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 21:30 | NZD | Business NZ PSI Oct | 46 | 45.7 | | 21:45 | NZD | PPI Input Q/Q Q3 | 1.90% | 1.00% | 1.40% | | 21:45 | NZD | PPI Output Q/Q Q3 | 1.50% | 0.90% | 1.10% | | 23:50 | JPY | Machinery Orders M/M Sep | -0.70% | 1.40% | -1.90% | | 10:00 | EUR | Eurozone Trade Balance (EUR) Sep | 13.6B | 7.9B | 11.0B | 10.8B | | 13:15 | CAD | Housing Starts Oct | 241K | 239K | 224K | | 15:00 | USD | NAHB Housing Market Index Nov | 42 | 43 |
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