FXStreet (Mumbai) – Asia saw a US dollar strong rebound driving USD/JPY closer towards 124 barrier, while the EUR/USD pair was heavily sold-off as traders head into a data-heavy European session ahead. The Antipodean currencies also came under renewed selling pressure, shrugging off upbeat China HSBC manufacturing OMI report.
Key headlines in Asia
HSBC Flash China manufacturing PMI beats expectations in June – at 3-month high
NZD/USD hits fresh 5-year lows near 0.6860
EU Summit: Confident of a deal this week
Dominating themes in Asia – centered on JPY, AUD, NZD
A volatile Asian session, with broad based US dollar strength emerging the key underlying theme causing major moves across the FX board. The biggest loser in Asia is the EUR/USD pair, trading below 1.13 handle, down -0.66% on the day. While USD/JPY reached a new four day peak at 123.75 levels ahead of a batch of key US economic releases.
While, the entire antipodean complex reversed gains and fell in to losses on the back of greenback strength. The Kiwi slumped to fresh 5 year lows at 0.6937, ignoring better than expected Chinese manufacturing PMI data. The Kiwi remains pressured as the latest series of downbeat economic release from the New Zealand continues to support the case for further interest rate cuts. The Aussie hovers around 0.7700 awaiting fresh incentives from the upcoming US data.
Meanwhile, Japan’s benchmark Nikkei 225 index rallied to fresh 15 year highs, rising over 1.50% to 20,755.74, while the ASX 200 index also climbs 1.33% higher to trade at 6584.60.
Heading into Europe – centered on EUR, GBP
A raft of flash manufacturing and services PMI reports will be released during the European session, keeping EUR, GBP traders busy.
France’s flash manufacturing PMI will kick-off a busy session ahead, and is seen ticking up to 50.0 in June from 49.4 measured in the month before. The services sector is expected to come in at 52.5, slightly lower than the 52.8 recorded in May.
Followed by the June flash manufacturing PMI for Germany which is expected to register an uptick to 51.5 from 51.1 recorded in May, while the index for the services sector is projected to remain flat at 53.0, the same as recorded in the previous month.
While the forecast for the EU flash manufacturing PMI shows a downward move to 52.0 for June from 52.2 recorded in May. The EU’s services sector is also expected to make a downtick to 53.7 from 53.8 booked in May.
Looking ahead towards US session, traders are keeping an eye out for May’s durable goods release new home sales, and manufacturing data due to be reported later today. US durable goods orders data expected to show a 0.6% rise in core orders last month. While new home sales data is forecast to show a 524,000 rise in sales last month, gaining on April’s 517,000.
A preliminary manufacturing gauge reading for the world’s biggest economy is also due to be released on Tuesday, and markets are predicting a stronger performance for the sector this month.
(Market News Provided by FXstreet)