The NY session witnessed many of the previous risk trade correlations return to the fore. US equities took investors for a ride in what ultimately proved to be a suckers' rally as stocks closed down -0.8% on a sharp end of day selloff – reversing prior gains of nearly +1.5%. Gold traded in choppy fashion and ultimately was sitting near the top of the 894/882 range for today. US Treasuries remained ''offered'' and the 10-year yield added another 4 basis points into 2.94%. The Fed cannot be too happy that its purchases of US paper have thus far had little impact on rates here.
In FX it was a return to correlations and the wild ride in equities also had the USD on a rollercoaster. EUR/USD squeezed up to a session high near 1.3030/40 but eventually lost ground as risk was pared and was sitting near 1.30 ahead of the NY close. The yen crosses were also thrown around significantly. USD/JPY was sitting a touch below the NY open by 97.90 after trading into a 98.30 session peak. EUR/JPY saw more volatile price action, ranging about 180 pips from the session high to low and eventually settling near 127.30 after rocketing above 128 for a brief period. With the lower stocks/lower EUR/lower JPY cross correlations seemingly back on now, we would closely monitor equity marts overnight to gauge potential currency moves.
Upcoming Economic Data Releases (Asia Session) expected prior
- 4/22 23:50 GMT JN Foreign Buying Japan Bonds 17-Apr -Â¥169.3B
- 4/22 23:50 GMT JN Foreign Buying Japan Stocks 17-Apr ¥114.5B
- 4/23 1:30 GMT AU New Motor Vehicle Sales MoM MAR -3.50%
- 4/23 1:30 GMT AU New Motor Vehicle Sales YoY MAR -18.60%
- 4/23 3:00 GMT NZ Credit Card Spending (YoY) MAR -1.90%
- 4/23 4:00 GMT JN BOJ Governor Shirakawa to Speak
