ForexLive Asia-Pacific FX news wrap: BOJ’s Uchida triggered a sharp yen decline

• China July exports +6.5% y/y & imports +6.5% also (in CNY terms)
• ANZ forecast the RBNZ to remain on hold next week, signal a rate cut later in the year
• US equity index futures screaming higher in evening trade
• Japan chief cabinet secretary Hayashi says no comment on daily stock marekt moves
• Didn’t take much for yen to collapse: BOJ official says won’t raise rates if mkt unstable
• More from BOJ dep Gov Uchida: Appropriate to adjust degree of monetary easing
• USD/JPY surging on Ushida speech
• BOJ deputy governor Uchida says the Bank’s interest rate can change if needed
• PBOC sets USD/ CNY mid-point today at 7.1386 (vs. estimate at 7.1481)
• Goldman Sachs Chief Executive Officer David Solomon says it was a healthy stock correction
• Japan ruling Liberal Democratic Party (LDP) big gun supports Bank of Japan rate hikes
• Wall Street Journal Fed watcher says Fed seen likely to cut 3 or more times in H2 2024
• Data shows Japan yen intervention on April 29 was the largest single day ever on record
• Goldman Sachs ask “Could this turn into a bear market?”
• RBA Assistant Governor (Economic) Hunter says economy running a little hotter than thought
• NZD/USD marked higher after the better than expected jobs report from New Zealand
• New Zealand Q2 unemployment rate 4.6% (vs. 4.7% expected)
• HSBC on tech stocks – “the froth has been removed from valuation”
• The response to the RBA meeting yesterday is a 25bp rate cut priced for December 2024
• ICYMI – US on the oil bid, buying 3.5 million barrels for the Strategic Petroleum Reserve
• ICYMI: Tesla has recalled 1.7 million cars
• Greenlight Capital’s David Einhorn on the US election – doesn’t matter who wins
• UBS on USD/JPY, says 140 to 150 the new normal
• Forexlive Americas FX news wrap 6 Aug: Yields higher as markets calm a bit.JPY still focus
• Private survey of oil inventories shows small headline crude build vs. small draw expected
• Goldman Sachs has introduced a new Financial Stress Index (FSI) – totally normal
• US stocks finish 1% higher but sellers took over in the final hour
• Trade ideas thread – Wednesday, 7 August, insightful charts, technical analysis, ideas

The
yen took a beating today while Japanese equities jumped. USD/JPY
traded up to just shy of 147.50 on the back of comments from Bank of
Japan deputy governor Uchida. The key point FX markets latched onto
were that Uchida said the Bank of Japan won’t raise rates while
markets are unstable. There is more from him in the bullets above but
that headline was the kicker.

USD/JPY
and yen crosses were extremely volatile. Liquidity and volume remain
below average in such a skittish market. Lows during the early Asian
morning were around 144.30, making for a 300+ point range.

The
Nikkei rose more than 2% and the Topix more than 3%.

Jobs
data from New Zealand showed the labour market is softening, but wage
growth remains on the high side, partly supported by government pay
agreements. The flip side of higher wages, though, is less total
hours worked. The unemployment rate rose in Q2 from Q1, but not by as
much as was expected. Employment was expected to have decreased, but
it rose. There was no compelling argument from this data for an
August rate cut. NZD/USD
jumped on the report, and after a pullback made new session highs and
has sustained these as I update.

AUD/USD
rose also. From the Reserve Bank of Australia today we had Assistant
Governor (Economic) Hunter speaking. She said that the economy is
running a little hotter than the Reserve Bank of Australia thought
previously.

Trade
data from China showed exports grew for a fourth straight month.

This article was written by Eamonn Sheridan at www.forexlive.com.