CIBCFX Flows$YEN pushed above 127.00, a level that held well over the North American session, it may have been a small barrier option. Move up was believed to be caused by Fed Res Bullard’s remark that we shouldn’t rule out rate increases of 75 bps. Bullard is a voter this year and considered the most hawkish board member. $YEN advanced to 127.225, then fell back to 127.00. Japan Finance Minister reiterated about forex, sudden moves are undesirable, yet market decides the forex rate. And the $YEN went bid. Fixing demand pushed $YEN to 127.36. Suzuki went on to say weak YEN has strong negative aspects in currently climate, that left very little impression, $YEN dropped few ticks then proceeded to take out 127.50. Next speedbump should be 128.00.RBA released its minutes from the last meeting, has little to offer, not much different from the short statement. To sum up, data over the coming months will offer additional important evidence of inflation and evolution of labour costs. We will just have to wait and see – April 27 is when Q1 CPI will come out then May 18 for Q1 wage growth. Very, very little I can pen about the AU$, trading has been dull, talk of dividend payment has the pair staying supported. AU$¥ did play a role. Small resistance at 93.91, better at 94.17. As for AU$, 50-day SMA at 0.7344, corporate bids scattered beneath 0.7320; sellers ahead of 0.7400.EUR$ met bids on the downside, could have be option related. It took quite bit of effort to bring it below 1.0770, which was the low during US session and market doesn’t seem to be keen. Target level is last week’s low of 1.0758, should be some sort of a barrier at 1.0750, then 1.0727, the low of April 2020. Option strikes at 1.0800 due this week, about €2.6bn, might attract some resistance around that level.In terms of Fed speakers this week, today Evans will be at Economic Club of New York. Non-voter, known dove, but last week the Chicago Fed President said he favors getting interest rates up into a range of 2.25% to 2.5% and this could involve raising rates by 50 bps next month. There will a Q/A. Evans will discuss the outlook for the economy and monetary policy at the Peterson Institute for International Economics on Wednesday. Mary Daly will give a speech on mid-year outlook on Wednesday as well. Daly is not a voter this year, also a dove and was rather hawkish on April 6 when she said she doesn’t expect a recession to happen but she supports tighter policy. Bostic, non-voter will speak on Thursday April 21. Chair Powell and ECB President Lagarde will be speaking at IMF on Friday April 22.CitiEuropean OpenJPY game of chicken with policymakers and officials continues, now on track for a record 13-day selloff as markets continue to probe deeper into no man’s land. Different today was the absence of rising Treasury yields, suggesting to us that momentum has taken over. Our spot desk suggests positioning is still not that heavy in the pair and saw options-tied USDJPY demand adding support to the move. AUD outperformed reversing part of Monday’s weakness, which occurred in very poor liquidity owing to holidays. KRW rates edged lower during the hearing of BoK’s new Nominee Governor, though KRW was calm. USD Asia was steady with CNH plateauing while a broader rethink on the composition of easing may be underway. Focus turns to key housing market data for USD, with secondary focus on Fed speak and central bank speakers for SEK and CHF.
Source: Tickmill