Oil futures opened up higher as traders reacted to yesterday’s data where China reported a rise in oil imports by 11.8%. However, started to pare gains as market tried to digests the impact of this change in Saudi Arabia oil minister. Most see little change in policy – WSJ article said officials from OPEC see an agreement to freeze oil production less likely when they meet in June.
I read of MNI that early demand for UsdJpy and EurJpy came from Japanese trust banks. UsdJpy rose to 107.635 where we encountered good resistance. Offers are scattered in the 107.60-70’s with 200-Hour MA at 107.65. More offers reported into 108.00 and stop buy orders from systematic funds only above 108.25.
Comments by Finance Minister Taro Aso on the level of UsdJpy at 107 does not prompt intervention. Furthermore, Tokyo’s action on intervention is not hampered by the US Treasury report to Congress.
Nothing much to pen on EurUsd. Do note there is a Eur3bn notional worth option at 1.1300-strike rolling off today NY cut. Greek parliament rushed to approve the overhauls of the tax and pension systems ahead of Monday’s EU Finance Ministers meeting. But no decision is expected.
Weak Shanghai stock market is likely to weigh on AudUsd. Meanwhile, commodity futures continue to come under pressure – Dalian iron ore futures down 5%; copper futures -3%; Steel Rebar down 6%; oil futures pared gains. So far Gold and Silver are the ones holding on well.