Market Overview

ForexLive Asia Wrap Monday 17 Dec 2012: Yen Gaps Lower on Japanese Election Result

The Japanese election results were the big news this morning in Asia; the LDP + New Komeito won 325 lower house seats between them - enough for a 2/3 majority.
The USD/JPY gapped higher, getting as high as 84.48 (& EUR/JPY above 111.00) before trading back below 84.00 on a 'gap fill' attempt.
The party of current PM Noda suffered a huge defeat, getting less than 60 seats (down from 230) in the 480 seat parliament.
There will be a special parliamentary sitting before year-end to confirm Shinzo Abe as new PM
The BOJ meets this week on the 19th and 20th; they are expected to ease further although there is some speculation that they may may well delay thier full easing plans until after the new government's policies are announced

 

In other news/data points:

New Zealand data: Q4 Consumer Confidence rose to 111.5 (from Q3's 102.5) - its highest reading since Q3 2011
UK data: December Rightmove National Asking Price showed a fall of 3.3% from November (although it registered a rise of 1.4% YoY)
Australian company Fairfax sold its stake in NZ company Trade Me for about $A616 Million.

 

In weekend Fiscal Cliff developments:

Boehner has proposed raising taxes on incomes greater than $1 Million (from 35% to 39.6%)
Boehner has offered to delay any fight over the debt ceiling for a year
He is also said to be willing to see new revenue sources of $1 Trillion (over 10 years) if the President will commit to significant savings from benefit programs

 

The USD/JPY was the big mover again today, gapping higher and trading to 84.48 before falling back below 84.00.
EUR/USD, too, had a better morning, as high as 1.3190 before itself pulling back to 1.3149 where technical support kicked in.
AUD/USD and NZD/USD traded in tight ranges, predominantly a little weaker on the day but with not much in it.

The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

Posted-In: News Forex Global Markets Trading Ideas

 

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