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FOREX: Yen Outperforms Amid Lower Yields/Equities, AUD/USD Back Sub 0.6200

FOREX
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Yen has outperformed in the G10 space so far in Thursday trade. Trends elsewhere are biased in favor of the USD, particularly against AUD and NZD. The BBDXY index is little changed though, last near 1311.4. 

  • USD/JPY is back sub 158.00, last near 157.80, around session lows and 0.35% stronger in yen terms. Earlier we had stronger than labor earnings data, although the initial reaction for USD/JPY was fairly muted.
  • Cross asset supports have been evident though, with US yields a little over 2bps softer across the Tsy benchmarks. US equity futures are lower as well, after headlines crossed earlier that the Biden administration would curb chip exports further. Regional equity markets are also mostly softer.
  • AUD/USD is testing under 0.6200, although is still above intra-session lows from Wednesday at 0.6188. We had retail sales slightly below expectations (+0.80%, versus +1.% forecast), while the trade surplus was higher than forecast. Market pricing for an RBA cut at the Feb meeting is just over 70%, supported after yesterday's slower core CPI print and retail sales today. NZD/USD has fallen in sympathy with the A$, off by 0.20%, last under 0.5600.
  • AUD/JPY is back sub 98.00, but still above recent lows around the 97.00 level.  
  • EUR/USD is down slightly, but holding above 1.0300 at this stage.
  • GBP/USD continues to soften, last near 1.2330/35, which is still above lows from Wednesday, but downside focus remain in play for the pair. 2024 lows just under 1.2300 aren't too far away.
  • Later the Fed’s Harker, Collins, Barkin, Schmid and Bowman speak. US December Challenger job cuts, euro November retail sales, German November trade & IP print.
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Yen has outperformed in the G10 space so far in Thursday trade. Trends elsewhere are biased in favor of the USD, particularly against AUD and NZD. The BBDXY index is little changed though, last near 1311.4. 

  • USD/JPY is back sub 158.00, last near 157.80, around session lows and 0.35% stronger in yen terms. Earlier we had stronger than labor earnings data, although the initial reaction for USD/JPY was fairly muted.
  • Cross asset supports have been evident though, with US yields a little over 2bps softer across the Tsy benchmarks. US equity futures are lower as well, after headlines crossed earlier that the Biden administration would curb chip exports further. Regional equity markets are also mostly softer.
  • AUD/USD is testing under 0.6200, although is still above intra-session lows from Wednesday at 0.6188. We had retail sales slightly below expectations (+0.80%, versus +1.% forecast), while the trade surplus was higher than forecast. Market pricing for an RBA cut at the Feb meeting is just over 70%, supported after yesterday's slower core CPI print and retail sales today. NZD/USD has fallen in sympathy with the A$, off by 0.20%, last under 0.5600.
  • AUD/JPY is back sub 98.00, but still above recent lows around the 97.00 level.  
  • EUR/USD is down slightly, but holding above 1.0300 at this stage.
  • GBP/USD continues to soften, last near 1.2330/35, which is still above lows from Wednesday, but downside focus remain in play for the pair. 2024 lows just under 1.2300 aren't too far away.
  • Later the Fed’s Harker, Collins, Barkin, Schmid and Bowman speak. US December Challenger job cuts, euro November retail sales, German November trade & IP print.