U.S. e-mini futures faced some headwinds after Snap Inc. released a disappointing earnings report, while regional players parsed disappointing U.S. data released Thursday. This generated demand for traditional safe havens, but the yen had to give way to the greenback as U.S. Tsy yield curve bear flattened.
- USD/JPY recouped its initial losses, with good demand emerging over the Tokyo fix. Renewed buying of the spot rate was out of sync with the move lower in USD/JPY 1-month risk reversal, which pulled back from a multi-week high registered Thursday.
- Japan's CPI figures fell in line with expectations, with core prices posting the biggest one-month increase since Sep 2008 (when adjusted for the sales tax hike impact). While core CPI growth is above the BoJ's target of +2.0% Y/Y, the Bank continues to stress that current price pressures are being driven by supply-side factors rather than demand-pull matters.
- NZD paced losses in G10 FX space, which allowed AUD/NZD to climb past NZ$1.1100 and plumb a fresh multi-week high at NZ$1.1107 (y'day's peak was NZ$1.1106).
- The European FX bloc showed some weakness amid lingering concerns over Russian gas supplies & Italian political turmoil.
- Manufacturing PMIs from across the globe will keep hitting the wires going forward, other data highlights include UK & Canadian retail sales. ECB's Villeroy will speak on payments security.