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Asia seeing higher AUD and lower Yen - Societe Generale

FXStreet (Guatemala) - Kit Juckes, Global Head of Currency Strategy at Societe Generale noted the key fundamentals events occurring overnight in Asia.

Key Quotes:

“Asian news saw Japan's current account surplus beat expectations at ¥414bln. Falling oil prices will help the trade balance, while the yen's weakness is already helping to boost domestic returns on the country's foreign assets”.

“The FX market didn't react to that however, but to the combination of slightly higher US yields and another high in equities”.

“A fall in consumer confidence is a reminder if needed that higher equity prices and inflation expectations alone won't solve Japan's problems and the USD/JPY uptrend remains intact”.

“And with it, the disinflationary pressure on Japan's neighbours”.

“Further south, Australian business confidence beat expectations and house prices continue to increase at a brisk rate (9.1% y/y) , both helping the AUD a bit, though the downtrend in iron ore prices (and in raw materials in general) is more fundamental to the AUD outlook and we remain bearish”.

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