27 Aug 2015
AUD/JPY trims gains, Aus Capex disappoints
FXStreet (Mumbai) - The Australian dollar pared gains and retraced from highs versus the Japanese yen in the mid-Asian trades, now pushing AUD/JPY towards the mid-point of 85 handle, as markets digest the latest below estimates Australia’s capital expenditure figures which continues to disappoint in Q2.
AUD/JPY rejected at 86
Currently, the AUD/JPY pair trades 0.35% higher at 85.66, reversing a spike to 86 barrier shortly after data release. The cross in the AUD/JPY rallied in a knee-jerk reaction to the Capex numbers, although reversed the initial bounce and turned lower as the capital expenditure data from Australia came in worse than expectations, led by decreased mining sector investments.
Private capex fell 4.0% in the June quarter, according to the Australian Bureau of Statistics (ABS), coming in weaker than the consensus forecast of a 2.5% decline, but improving on the revised 4.7% slump recorded in the March quarter.
However, the cross remains supported on the back of weaker yen versus the US dollar as rallying US and Asian equities boosts risk-on trades, reducing yen’s appeal as a safe-haven.
Markets now shift their attention towards the key US GDP data due later tonight which may have major impact on AUD and JPY.
AUD/JPY Levels to watch
The pair has an immediate resistance at 86 (Today’s High) levels, above which gains could be extended to 87.19 (Aug 25 High). On the flip side, support is seen at 85.36 (Today’s Low) levels from here it to 84.43 (Aug 25 Low).
AUD/JPY rejected at 86
Currently, the AUD/JPY pair trades 0.35% higher at 85.66, reversing a spike to 86 barrier shortly after data release. The cross in the AUD/JPY rallied in a knee-jerk reaction to the Capex numbers, although reversed the initial bounce and turned lower as the capital expenditure data from Australia came in worse than expectations, led by decreased mining sector investments.
Private capex fell 4.0% in the June quarter, according to the Australian Bureau of Statistics (ABS), coming in weaker than the consensus forecast of a 2.5% decline, but improving on the revised 4.7% slump recorded in the March quarter.
However, the cross remains supported on the back of weaker yen versus the US dollar as rallying US and Asian equities boosts risk-on trades, reducing yen’s appeal as a safe-haven.
Markets now shift their attention towards the key US GDP data due later tonight which may have major impact on AUD and JPY.
AUD/JPY Levels to watch
The pair has an immediate resistance at 86 (Today’s High) levels, above which gains could be extended to 87.19 (Aug 25 High). On the flip side, support is seen at 85.36 (Today’s Low) levels from here it to 84.43 (Aug 25 Low).