Asian Session - Dollar regains some losses against yen
The US dollar rebounded against the yen to recover some losses made after a huge tumble following disappointing US nonfarm payrolls data on Friday.
The data raised concern about the health of the US economy and led to speculation that a Fed rate hike may be further delayed.
The weaker jobs number caused a sell-off in the dollar and investors were forced to unwind stretched short positions on the yen. This gave the Japanese currency a bit of a breather from recent weakening.
UDJPY climbed up to 103.48 yen in the Asian session, up 0.5 percent to recover some losses after its big drop on Monday, when the pair fell over 1 percent to a one-month low.
A trade report from Japan today showed that country’s current account recorded a larger deficit in November, weighing further on Japan’s balance of payments. This will dent sentiment on the yen.
In other currencies, the euro remained steady against the dollar, close to Friday’s highs when it rallied on the back of the US jobs report. EURUSD traded at $1.3666, off a one-month low of $1.3548 hit on Thursday.
The pound remains weak after falling on Monday against the dollar. Key risk for the sterling will be UK inflation data due later today. GBPUSD ended in Asia at $1.6387, rebounding slightly from yesterday’s low of $1.6346.
The Australian dollar, which has benefited from weakness in its US counterpart and hit a one-month high on Monday, has since retreated, down to $0.9034. AUDUSD is down 0.2percent from Monday’s high of $0.9087.
Key data to watch for in the European session will be UK CPI and Euro zone industrial production data. During the US session, US retail sales data are scheduled for release.