25 Oct 2013
Session Recap: Surprise data and news catches some off-guard in the Yen and the US Dollar
FXstreet.com (Barcelona) - Surprisingly hot Japanese inflation data and unconfirmed rumors that the Bank of Korea was re-cycling large amounts of US Dollars back into the system sent the Yen higher early-on Friday and the DXY lower over the last hour.
Japanese inflation data surprises on the upside
The headline Japanese inflation number came out at 1.1% y/y for September: The reading of 1.1% beat both the expected number of 0.9% as well as the prior month’s reading of 0.9%. The reaction in the crosses with JPY involved were uniformly Yen-bullish. The key “risk tells” – AUD/JPY and EUR/JPY – were trading conspicuously lower after some initial upside head-fakes.
Rumors of BOK selling weighing down the greenback
Unconfirmed rumors that the Bank of Korea was out in the open markets dumping the US Dollar by way of selling their large previously acquired position in USD/KRW put pressure on the greenback versus all of the other members of its currency pairs. The DXY itself dropped from 79.25 to 79.08 from peak to trough over the course of the session.
Trading in the majors sending mixed messages with the DXY and Yen heading in different directions
A quick scan of the charts of the major forex futures reveals a confused market Friday. The Yen is going full-speed higher and the DXY is matching the intensity in the opposite direction. The initial read of the futures would be that it still is a fairly risk-averse mood across the board.
Japanese inflation data surprises on the upside
The headline Japanese inflation number came out at 1.1% y/y for September: The reading of 1.1% beat both the expected number of 0.9% as well as the prior month’s reading of 0.9%. The reaction in the crosses with JPY involved were uniformly Yen-bullish. The key “risk tells” – AUD/JPY and EUR/JPY – were trading conspicuously lower after some initial upside head-fakes.
Rumors of BOK selling weighing down the greenback
Unconfirmed rumors that the Bank of Korea was out in the open markets dumping the US Dollar by way of selling their large previously acquired position in USD/KRW put pressure on the greenback versus all of the other members of its currency pairs. The DXY itself dropped from 79.25 to 79.08 from peak to trough over the course of the session.
Trading in the majors sending mixed messages with the DXY and Yen heading in different directions
A quick scan of the charts of the major forex futures reveals a confused market Friday. The Yen is going full-speed higher and the DXY is matching the intensity in the opposite direction. The initial read of the futures would be that it still is a fairly risk-averse mood across the board.