Forex Today: Yen outperforms in Asia again, EZ GDP, US CPI eyed

Widespread risk-aversion was the main theme in Asia this Wednesday, triggered by aggressive selling the Japanese stock markets, which boosted the safe-haven bids for the Yen at the expensive of the higher-yielding oil and Treasury yields. As a result, the US dollar came under fresh selling pressure across its main competitors, benefiting the risk-sensitive currencies such as the Aussie and GBP. The Kiwi rallied sharply amid a broadly weaker USD and a beat on the NZ inflation expectations data. Meanwhile, the EUR/USD pair broke higher towards the 1.24 handle heading into a data-heavy EUR session today.

Main topics in Asia

Westpac-MI Consumer Sentiment fell by 2.3% to 102.7 - Westpac

Analysts at Westpac explained Westpac-MI Consumer Sentiment for February’ was marked by a wave of volatility in global share markets. 

RBNZ NZ 2-year expectations 2.11 % vs. 2.02% last

The Reserve Bank of New Zealand (RBNZ) is out with its quarterly inflation expectations report, with the key details found below.

USD/JPY drops in tandem with Nikkei, weakest since Nov 2016

The bears regained control after a brief recovery seen in the USD/JPY pair, now pushing the rates southwards in a bid to print the lowest levels since November 2016.

Japan: Growth set to remain sluggish - Capital Economics

Marcel Thieliant, Senior Japan Economist at Capital Economics explained that GDP growth slowed sharply last quarter and we think that the economy won’t expand as strongly this year as it did in 2017.

Key Focus ahead

The EUR, GBP traders eagerly await the releases of the growth numbers from Germany as well as the Eurozone, which will reinforce optimism over the bloc’s economic prospects. Also, the Eurozone industrial production data will be reported among other minority reports. Meanwhile, the central bankers’ speeches will be also heard in Europe.

ECB policymaker and Germany’s Bundesbank (Buba) President Jens Weidmann will deliver the opening remarks at the Bundesbank Cash Symposium, in Frankfurt while SNB board member Zurbrugg will make a couple of appearances on the wires, speaking at the same event.

In the NA session, all eyes will be on the US CPI figures, followed by the retail sales report while the EIA crude inventories data is also due on the cards in the American morning.

EUR/USD catches fresh bids on notable USD supply, nears 1.2400

The EUR/USD pair traded with sizeable gains in Asia, as the bulls aimed to regain the 1.24 handle amid a broadly weaker US dollar, with attention turning towards the US inflation data release.

GBP/USD pushing up ahead of EU GDP release, looking for 1.3980

GBP/USD is finding buyers today, trading into 1.3915 ahead of European markets. Except for retail sales on Friday at 09:30 GMT, there's little Sterling-specific data on the calendar this week …

Dollar’s Rally Turning into a Dead-Cat Bounce?

I wouldn’t give up on the dollar quite yet, but DXY appears to be rolling over without having surpassed any significant peaks on the daily chart.  This is bearish price action. 

US inflation data is the big story

We get inflation data tomorrow, although it probably won't put the story to bed. The FT reports "According to economists, January's figures will show headline US inflation easing to 1.9 percent from 2.1 percent in December.

GMT
Event
Vol.
Actual
Consensus
Previous
Wednesday, Feb 14
07:00
 
3.0%
2.8%
07:00
 
1.6%
1.6%
07:00
 
-0.7%
-0.7%
07:00
 
1.4%
1.4%
07:00
 
-1%
-1%
07:00
 
0.6%
0.8%
07:00
 
2.2%
2.3%
08:00
 
 
08:50
 
 
n/a
 
 
1.28%
10:00
 
0.6%
0.6%
10:00
 
2.7%
2.6%
10:00
 
0.2%
1.0%
10:00
 
4.2%
3.2%
10:20
 
 
11:20
 
 
12:00
 
 
0.7%
12:45
 
 
13:30
 
0.2%
0.4%
13:30
 
0.4%
0.3%
13:30
 
0.4%
0.4%
13:30
 
254.330
254.400 Revised from 254.426
13:30
 
0.3%
0.2% Revised from 0.1%
13:30
 
247.604
246.524
13:30
 
0.2%
0.2% Revised from 0.3%

 

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