ASIA SUMMARY

It was another wild Asian session after Australia’s Consumer Price Index came in at .1% quarter over quarter vs. expectations of .6%. The worse than expected number combined with yesterday’s quarter over quarter Producer Price Index which came in at 0% vs. expectations of .6%. The miss by both numbers points to lower inflation for Australia and less of a chance of a rate hike in the near future. AUD/USD sold off hard to settle in the .8250 area.

The broader market took the lower AUD/USD as an excuse to sell the carry trade as AUD/JPY is a popular pair. We saw EUR/JPY which had been holding around the 161 level break down through the NY’s lows. Weakness in JPY crosses were also helped by USD/JPY’s failed attempts at the 119 handle. CHF crosses were also weak as EUR/CHF sold back down through 1.6400.

Equity markets took a fall as risk reduction had its affect across markets. The Nikkei traded down 140 points (-.8%) at midday. The Shanghai Composite was down 10.62 (-.29%) at midday.

Upcoming Data Release (UK Session):

Switzerland: (2:15am EDT) Trade Balance expected 1.11 billion vs. previous 1.38 billion

EC: (3:30am EDT) ECB’s Liebscher holds press conference in Vianna. (3:45am EDT) ECB’s Garganas holds press conference in Athens. (4am EDT) ECB Euro-zone current account expected 1.1 billion vs. previous 2.7 billion. (5am EDT) Month over month seasonally adjusted Industrial New Orders expected 1% vs. previous -.2%.