Asia Session Recap

Daily Forex Fundamentals | Written by Forex.com | Oct 14 08 05:56 GMT |

The USD/JPY pair exploded this session to 103.06, as risk aversion was abandoned and the carry trade was once again put on. A renewed confidence was abound in the marketplace after the record breaking gains on Wall Street spread into Asia where we saw the Nikkei 225 post gains over 13% in a record breaking day. Add to the elation the news that European governments presented a plan to keep their banks sturdy, and the gloom from last week seems to have cleared. As mentioned, the Yen was beaten down against the US Dollar, and against the Euro we saw the same story as it lost about 1% as the EUR/JPY pair moved higher by three and a half big figures from 138.52 to just over 141.00 as traders sold Yen and bought higher yielding pairs throughout Asia. AUD/JPY, NZD/JPY and GBP/JPY all made similar gains during the session.

As well as the boost to AUD/JPY, the AUD/USD made some nice gains as optimistic traders bought into the commodity currency on the back of a brighter global outlook. An AUD $10 billion 'rescue plan' by the RBA helped boost the local dollar as well as it took off from early lows of 0.6965 to tap highs near 0.7115. EUR/USD looked strong as the European rescue plans were unveiled, and on the back of EUR/JPY buying, the pair moved over a handle to reach just under 1.3700, a long way from Friday's 1.3260 low.

Tomorrow the US Treasury will unveil it's bank rescue plan which will give nine major US banks a total of $250 billion to keep the wheels greased. As the London session comes in we are seeing some record gains for equities, and when the US comes online it will be interesting to see if these moves will continue.

Upcoming Economic Data Releases (London Session):
10/14  6:30  FR  Bank of France Bus. Sentiment  SEP  94  92
10/14  6:45  FR  Consumer Price Index (MoM)  SEP  0.00%  0.00%
10/14  6:45  FR  Consumer Price Index (YoY)  SEP  3.20%  3.10%
10/14  6:45  FR  CPI - EU Harmonised (MoM)  SEP  -0.10%  0.00%
10/14  6:45  FR  CPI - EU Harmonised (YoY)  SEP  3.50%  3.40%
10/14  6:45  FR  CPI Ex Tobacco Index  SEP  118.64  118.68
10/14  8:30  UK  CPI (MoM)  SEP  0.60%  0.40%
10/14  8:30  UK  CPI (YoY)  SEP  4.70%  5.00%
10/14  8:30  UK  Core CPI YOY  SEP  2.00%  2.00%
10/14  8:30  UK  Retail Price Index  SEP  217.2  217.9
10/14  8:30  UK  RPI (MoM)  SEP  0.30%  0.50%
10/14  8:30  UK  RPI (YoY)  SEP  4.80%  4.90%
10/14  8:30  UK  RPI Ex Mort Int.Payments (YoY)  SEP  5.20%  5.40%
10/14  8:30  UK  DCLG UK House Prices (YoY)  AUG  -0.30%  -1.10%
10/14  9:00  GE  German Economic Institutes Present Biannual Group Forecasts  14-Oct      
10/14  9:00  GE  ZEW Survey (Econ. Sentiment)  OCT  -41.1  -51.1
10/14  9:00  GE  Zew Survey (Current Situation)  OCT  -1  -15
10/14  9:00  EC  ZEW Survey (Econ. Sentiment)  OCT  -40.9  -57.5
10/14  9:00  EC  Euro-Zone Ind. Prod. sa (MoM)  AUG  -0.30%  1.20%
10/14  9:00  EC  Euro-Zone Ind. Prod. wda (YoY)  AUG  -1.70%  -1.60%

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