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Session Recap: Yen recovers as Japan rhetoric eases

The Japanese Yen ends the session as the strongest currency following comments from Japan's Finance Minister Mr. Aso, saying that there is no plans to buy foreign bonds through the country's funds. The news is a step back in the kind of aggressive language Yen sellers would like to see to continue the bears party.

Another currency performing nicely was the Australian Dollar post the RBA minutes, in which the central bank said there is more room to cut rates if needed. The sense is that they can still reduce the cash rate, but they won't, as confidence indicators and the equity market continue on the rise. The Kiwi, unlikely the Aussie, had a poor performance after reports of China destroying some imported New Zealand milk powder, yet managed to recover almost all losses after Fonterra, the world’s biggest dairy exporter, played down reports referring to the incident as nothing more than an ordinary review.

Main Headlines in Asia (in chronological order)

- USD/JPY in the midst of a topping process?

- Still long way till 'risk on - risk off' paradigm over - HSBC

- USD/JPY selling-off on Japan's FinMin comments

- BoJ minutes overshadowed by Aso's headlines

- RBA minutes: retains easing bias, no urgency noted

- Japan to decide on BoJ governor after Abe's trip to the US

- China destroys some imported new zealand milk powder

- AUD/NZD: Rallying after Chinese milk ban

- Fitch affirms its ratings for the big four Australian banks

- USD/JPY: Another technical record surpassed

- NZD/USD has potential for 0.8575; corrective turn not discarded - JPMorgan

Forex: GBP/USD unable to close weekly opening gap below 1.55

Little changed since early weekly start with a gap down to current quote at 1.5472, Cable has been moving in between fresh 7-month lows 1.5437, and weekly highs at 1.5508 for the time being, unable to close the gap lower so far. London session ahead will offer a blank economic agenda Pound related, eyeing Wednesday's BoE minutes and UK Claimant count change as next key risk events ahead for the pair, that is down -4.86% since year started.
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