FX Flows

From the FXWW Chatroom: Oil story continues to dominate UsdCad. Headline from Reuters that oil and gas workers in Kuwait have ended their 3-day strike. Without further details, took a while for market to verify the news. Oil futures started to slip and UsdCad climbed slowly towards 1.2700. Two option expiry today, 1.2600 and 1.2700.

Despite Goto-bi Day, Japanese banks were better sellers of UsdJpy and AudJpy. Our colleague in Tokyo, Haru, highlighted AudJpy nearing the 200-Day MA, which probably attracted some selling. I heard offers are still at 109.40-50 and intraday buying comes in at 108.70-75. I also heard leverage and algo accounts are responsible for selling NzdJpy this morning; leaving offers atop 76.80.

Both Aud and Nzd weakened in Asian hours and the cause came from Jpy-crosses.

Creeping Euro. Not a lot to add ahead of ECB tomorrow. Since market took out stops above 1.1350, the EurUsd has found ready buyers at that level. Fresh offers 1.1380-85 and you-know-what above 1.1412.

Spot Gold opened at 1250 then climbed towards 1257. Talk that Chinese demand following the launch of Yuan-denominated Gold benchmark in Shanghai yesterday. Someone mentioned that it was Silver which was leading the spot Gold. Apparently, Gold-Silver ratio fell to lowest, and Silver was doing a catch-up, rising 1.4% for the day.

Asians
They didn’t like Usd/Asia yesterday but not today – despite low USDCNY fix by PBOC. General profit taking across the board – even USDCNH traded higher.

1s UsdKrw NDF struggled and managed to surface above 1130. UsdSgd higher as well but seemed momentum funds patiently at 1.3410.

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