USD Generally Bid In Asia, But EUR Leads The Way

A couple of bouts of general USD demand were evident in Asia-Pacific hours, with residual weakness in the Chinese tech sphere on the back of Thursday’s regulatory announcements out of the U.S. re: audit-related non-compliance of 5 Chinese U.S.-listed firms and some worry about Russian shelling of a Ukrainian building with an experimental nuclear reactor inside seemingly creating USD demand.

• JPY weakness surrounding the Tokyo fix bolstered the rally in USD/JPY, with a second wave of JPY weakness coming during the afternoon. This meant the JPY found itself at the bottom of the pile when it came to G10 FX trade, even as the wider equity sphere traded lower. USD/JPY has registered fresh multi-year highs as a result, adding 60 pips to trade just shy of Y116.75 into European hours. Technically, bulls will now look to test resistance in the form of the 2.00 projection of the Apr-23-Jul 2-Aug 4 ’21 price swing (Y117.08).
• It wasn’t all one-way traffic for the USD. Asia-Pac participants were keen to buy the EUR in early regional dealing, likely looking to capitalise on the EUR/USD cheapening witnessed during the second half of Thursday’s NY session, after the impulse from the ECB’s hawkish moves when it came to QE faded.
• UK GDP readings, U.S. UoM sentiment, the Canadian labour market report and post-meeting ECB speak from Centeno & Rehn provide the highlights of the broader docket on Friday.