Currency Markets Wait on The NFP Result

Points to consider in this Forex article:

• The Japanese yen corrects higher this morning. The yen had hit a monthly low against its majors before correcting.
• The Australian Dollar falls as rate cut speculation with the Reserve Bank of Australia builds.
• Markets should consolidate before tomorrow’s non-farm payroll (NFP) data release.

The Japanese yen has corrected broadly higher in early Asian trade hours after the currency hit a monthly low against its major Forex trade partners. The Australian Dollar also faced selling pressure this morning as the prices tracked front-end bond yields lower. Investors are starting to price in an imminent rate cur at the next monetary policy meeting of the Australian central bank, the RBA.

There is very little calendar risk on today’s plate. From both the European and US docket. Investors are waiting on tomorrow’s non-farm payroll release. Economists are expecting the US economy to add 170,000 new Jobs in September. The world’s largest economy added 151,000 in August. The unemployment rate is expected to remain unchanged. There is still some fiasco left with Germany’s largest commercial bank, Deutsche Bank. This has been a big driver for risk appetite and they are currently engaged to settle their massive settlement owed to US regulators. The bank’s Chief Executive Officer John Cryan is on his way to the United States to finalize negotiations.

In other market news, the Asian and Pacific Rim markets rose on rising crude oil prices. Shares of Samsung Electronics spikes higher after a US activist investor called for a complete overhaul of the corporate structure.

Even with typhoon Chana hitting South Korea, the Kospi Composite Index tracked 0.3 percent higher on the day. The Typhoon has killed 3 people, so far, and flooded the city of Busan. The city has key factories and industrial zones. Dozens of flights have also been cancelled out of Korea. Shares of Hyundai Motor lost 0.7 percent this morning after two of its factories were damaged thanks to this typhoon. The factories have now shut operations to assess damages.

The Kospi index did get support from heavily weighted Samsung Electronics. Shares of the electronic behemoth and maker of the Galaxy smartphones, rose over 3.7 percent after the US based hedge fund, Elliot Management, published a letter calling on the Korean company’s board of directors to make several governance changes. These include splitting and increasing the corporate dividend among other changes.