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Forex Today: markets jittery on N. Korean missile test, another day of important US macro data

North Korea fired another missile over Japan and raised investors concerns over geopolitical risks, eventually reviving safe-haven demand during early Asian session on Friday. Following a knee-jerk reaction, the USD/JPY pair quickly recovered back above the key 110.00 psychological mark as the greenback remained underpinned by Thursday's stronger-than-expected US CPI print for August, which could have raised expectations for an additional Fed rate hike action by the end of this year. 

CPI raises rate hike expectations - ANZ
Analysts at ANZ explained that for those, including a number of FOMC officials, that felt that the recent waning in US inflation was a transitory story, the August CPI will provide some relief. 

Main topic in Asia

North Korea has launched a missile - BNO News
North Korea has launched a missile. Japan has issued an emergency alert, warning residents to seek shelter immediately.

North Korea warns US of stronger self defense actions
Rodong Sinmun that Kim Jong Un may take stronger self defense action if US continues current course.

Japan PM Abe: Calling on UN to hold emergency security council meeting
North Korea's latest misadventure has not gone down well with the Japanese government. 

USD/JPY bulls fought back to the 110 handle despite N.Korea risk
USD/JPY gave some profits to the bears in early Asia when the N.Korean news crossed the wires, sending the usual safe haven suspects loose and seeing territory in the yen up to 109.55 vs the greenback before bouncing back.

AUD/USD struggles to regain 0.80 on US inflation surprise
The North Korea news did rock the US dollar during the overnight trade,  however, the US inflation surprise ensured the 0.80 handle becomes a tough nut to crack.

NZD/USD: a week is a long time in politics, but... - ANZ
Analysts at ANZ explained that they say a week is a long time in politics, "but it is clearly a long time in FX markets too", they said, with the NZD back under pressure again as local political polls whipsaw.

Key Focus ahead

Meanwhile, the GBP/USD pair held on to previous session’s hawkish BoE-led strong gains to fresh one-year highs as investors' focus now shifts to another big day of US macro data, including the key monthly retail sales, manufacturing data and Prelim UoM Consumer Sentiment index. 

BoE made it reasonably clear, rates will rise – ANZ
Analysts at ANZ explained that the BoE made it reasonably clear that it could be joining the Fed and BoC in withdrawing policy stimulus shortly as inflation starts to supplant Brexit on its list of worries.

GBP/USD: Bulls losing steam on North Korea-led risk-aversion?
The GBP/USD pair paused its BOE-inspired rally just ahead of 1.34 handle and consolidated almost throughout the Asian trades below the last, as markets digest the overnight North Korea news heading into the key US retail sales and industrial production data due later on Friday.

Key US retails sales outlook - Nomura
Analysts at Nomura offered their outlook for the key US retail sales.

US Industrial Production preview - Nomura
Analysts at Nomura offered their outlook for the day's data ahead in US Industrial production.

University of Michigan consumer sentiment preview - Nomura
Analysts at Nomura noted the University of Michigan consumer sentiment coming up as a key event in the US shift.

Ahead of the US data, ECB speakers might influence sentiment around the shared currency and provide some short-term trading impetus during early European trading session.

EUR/USD: Downside back in play ahead of US data?
The EUR/USD pair stalled its relief-rally just below the key resistance located near 5-DMA at 1.1928 levels, as attention turns towards the crucial US retail sales and industrial production data for the next direction.

GMT
Event
Vol.
Actual
Consensus
Previous
Friday, Sep 15
06:00
 
 
-0.5%
06:00
 
 
€-0.3B
06:00
 
 
14.3B
07:00
 
 
10.2%
n/a
 
 
0.93B
08:15
 
 
09:00
 
 
$-3.763B
09:00
 
€21.4B
€26.6B
09:00
 
€20.1B
€22.3B
09:00
 
 
1.5%
10:00
 
1.35%
-2.60%
10:00
 
5.75%
6.10%
10:30
 
8.5%
9.0%
11:00
 
 
11:00
 
$11.40B
$11.45B
11:30
 
 
6.3%
11:30
 
 
$398.12B
12:00
 
 
-0.8%
12:30
 
19.0
25.2
12:30
 
0.5%
0.5%
12:30
 
0.3%
0.6%
12:30
 
0.1%
0.6%
13:00
 
 
1.1%
13:15
 
0.1%
0.2%
13:15
 
76.8%
76.7%
14:00
 
95.1
96.8
14:00
 
0.2%
0.5%
n/a
 
 
3.64%
17:00
 
 
756

Author

Haresh Menghani

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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