Risk-on sentiment emerged the main underlying theme in Asia amid renewed hopes of US tax reforms. However, higher-yielding currencies such as the Aussie, NZD and GBP failed to benefit from a better risk environment amid looming political uncertainty, with the immediate focus now shifting towards Sunday’s first round of the French presidential election.
Meanwhile, amongst the Asia-pac currencies, the yen recovered ground on the back of solid Japanese PMI data, while the Kiwi was the weakest in Asia. The US dollar paused its US treasury secretary Mnuchin’s comments induced rally, and consolidated almost throughout the Asian session.
Attention now remains on a raft of flash services and manufacturing sector PMI reports due to be released from across the Euro area, followed by the UK retail sales data and BOE MPC member Saunders’ speech. Also, the NA session is expected to quite eventful, with the Canadian CPI releases, Fedspeaks and US flash services and manufacturing PMI readings.
However, all eyes will remain on the EUR/USD price-action, as the French presidential election race gets tighter. The latest Elabe Poll shows Marcon with 24% support, followed by a 21.5% support for Marine Le Pen. Fillon stands at 20%, while Melenchon is at 19.5%.
Main topics in Asia
Reuters reported key highlights of the German Finance Ministry's monthly report published earlier on the day.
BOJ’s Kuroda: BOJ will continue to pursue easy monetary policy to hit 2% target at earliest
Bloomberg reports headlines by the BOJ Governor Kuroda, delivered during his interview with Bloomberg TV overnight.
Asian stocks gain on US tax reform hopes
Asian stocks rallied this Friday morning on optimism for a US tax reform.
Japan Manufacturing PMI jumped to 2-month high, export orders rise
Nikkei flash manufacturing PMI index released today showed the activity in Japan expanded at a fastest rate in 2 months largely due to a jump in the new export orders.
Key Focus ahead
French first round elections: euro to remain bid on expected outcomes?
It’s the first round of the French Presidential elections this weekend, (23 April). While it is just the first round, from a market perspective, in fact, this could be more of a compelling event than the second as it is the first round…
GBP/USD looks vulnerable, eyes 1.2750 on UK data
The GBP/USD pair is on a gradual decline so far this Friday, now flirting with 1.28 handle, despite risk-on market profile.
Trump expected to sign two executive financial orders today - CNBC
CNBC reported, via Reuters, that the US President Trump is expected to sign two executive financial orders on Friday.
EUR/JPY Forecast: Could test 110.92 if Le Pen comes out victorious in first round
The top five candidates in 2017's French election are - Francois Fillon (Les Republicains), Benoit Hamon (Socialists), Marine Le Pen (Front National) and Emmanual Macron (Independent) and Jean-Luc Mélenchon (Unbowed France).
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