The markets started the day with a risk off mood prevailing strongly across the global markets. In Asia, the Nikkei225 closed down 2.42% while the Shanghai Composite managed to gain 1.46%. Despite Japan’s average cash earnings rising 0.90%, more than the forecasted 0.20%, it did little to help sentiment as the yen continued to firm as the day progressed. USDJPY was trading near a one-year low at 110.55, down nearly 0.72% for the day. The yen’s appreciation caught the attention of Japanese officials, who warned currency speculators on USDJPY and that authorities were keeping a close eye on the exchange rates for the yen. Despite a brief pullback after the comments, USDJPY resumed its downtrend.
Data from Australia today included the RBA’s rate statement which saw the central bank take a dovish stance on the Australian dollar’s recent appreciation against the Greenback. In the RBA’s monetary policy statement, references were made to the recent AUD’s strength which was seen as a problem for the economy despite a broad-based turnaround in commodities. The RBA left interest rates unchanged at 2.0% but kept its options open. Inflation remained a big worry for the central bank. Besides the RBA’s decision, trade balance numbers from Australia saw the trade deficit widen to A$3.41 billion. AUDUSD which started to retreat since yesterday continued to post a steady decline and is down 0.88% at the time of writing, trading at $0.753.
NZDUSD was also weaker down 0.88% at the time of writing ahead of Global dairy price data release.
In Europe, services PMI data across the region showed a soft print. The Eurozone services PMI index fell to 53.1, down from 54.0 in February. German factory orders data plummeted 1.20% missing estimates of 0.50% increase. EURUSD was also weaker today down 0.10% at the time of writing. The single currency briefly fell to session lows of $1.355 before trimming the losses to currently trade at 1.379.
