Forex Today: Aussie pops, Yen drops in Asia, ECB minutes in focus

Forex today in Asia was dominated by the USD flows driven by the latest Chinese headlines, citing that the report on China’s reduction of the US Treasuries could be based on wrong information. As a result, both the EUR and GBP drifted lower while the Yen dived deeper into the red zone, having faced a double whammy from resurgent USD demand and BoJ’s status quo on JGB buys today. The Kiwi also returned to the negative territory below 0.72 handle. However, the Aussie stood resiliently and rallied hard on the back of a beat on the Aus retail sales data.  

Among other related markets, both crude benchmarks traded largely subdued while the Asian markets tracked the Wall Street lower, in the wake of the NAFTA fallout and the recent Yen gains.

Main topics in Asia

Australia November retail sales blow past expectations

The Australian Bureau of Statistics (ABS) data released today showed consumption as represented by the retail sales rose 1.2 percent month-on-month in September, beating the forecast of 0.4 percent growth by a big margin. 

China Govt Source: Report on China reducing its UST buys is based on wrong information

Reuters quoting a Chinese government source, citing that the report on China considering reducing or stopping purchases of the US Treasuries (UST) could be based on wrong information.

BoJ leaves JGB purchases steady today

The Bank of Japan (BoJ) leaves its JGBs purchases unchanged in today’s operation, which should help calm the speculation surrounding taper talks.

Nikkei Business Daily - Japan to delay primary budget surplus

The Japanese government is planning to spend revenue generated from the planned sales tax rise on social measures, says Nikkei business daily. 

S. Korea's major cryptocurrency exchanges raided by police, tax authorities - RTRS

Reuters quoted "people familiar with the investigation said on Thursday", South Korea’s largest cryptocurrency exchanges were raided by police and tax agencies this week for alleged tax evasion.

Key Focus ahead

We have a fairly eventful EUR calendar ahead, with the BOE Credit Conditions survey to be reported before the release of the Eurozone industrial output data. Markets eagerly await the ECB monetary policy minutes due on the cards ahead of the US open.

Meanwhile, from the US, the key PPI data will be reported alongside the usual weekly jobless claims. Also, in focus will be the Canadian NHPI data and FOMC member Dudley’s speech due later on Thursday.

EUR/USD headed back to 1.2000 ahead of EZ data, ECB minutes?

Having stalled its corrective slide near 1.1940 levels in the overnight trades, the EUR/USD pair attempted to recover some ground, but sellers continued to lurk near 1.1965 region.

GBP/USD - Yield spread may rise in a GBP-negative manner on Brexit fears

GBP/USD is holding above 1.35, but risks falling well below the previous day's low of 1.3482 as Brexit fears may push up the 10-year US-UK yield spread in the GBP-negative manner.

EUR/JPY risk reversals - bearish bias strengthens

The one-month 25 delta risk reversal fell to -0.75; the lowest level since Nov. 27.

US PPI preview - Nomura

The Research Team at Nomura provides key insights on what to expect from today’s US PPI data due to be reported at 1330GMT.

GMT
Event
Vol.
Actual
Consensus
Previous
Thursday, Jan 11
05:00
 
 
116.4
05:00
 
 
106.5
09:30
 
 
13:30
 
3.0%
3.1%
13:30
 
2.5%
2.4%
13:30
 
0.2%
0.3%
13:30
 
0.2%
0.4%
13:30
 
245K
250K
13:30
 
1.915M
1.914M
13:30
 
 
3.5%
13:30
 
0.2%
0.1%
15:30
 
 
-206B
18:00
 
 
2.804%
19:00
 
 
$-139B
20:30
 
 
23:50
 
 
2.7%
23:50
 
 
¥76.2B
23:50
 
 
¥434.2B
23:50
 
¥1,836.1B
¥2,176.4B
23:50
 
 
¥430.2B
Friday, Jan 12
05:00
 
 
53.8
05:00
 
 
55.1
13:30
 
0.4%
1.0%
13:30
 
0.4%
0.8%
13:30
 
0.4%
0.8%

 

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