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Yen flat as busy regional data flow noted, China PMIs upbeat

3/31/2017, 10:47:13 AMMarket Analysis
Yen flat as busy regional data flow noted, China PMIs upbeat

The yen turned flat after early gains on Friday after mixed data on household spending, jobs and prices with China manufacturing coming in on the upside.

USD/JPY changed hands at 111.94, up 0.01%, while AUD/USD traded at 0.7647, up 0.08%. GBP/USD rose 0.18% to 1.2492.

China's semi-official manufacturing PMI rose to 51.8, the China Federation of Logistics & Purchasing (CFLP) said Friday, beating the expected 51.6 level and releasing the figures one day ahead of the normal first of the month release and ahead of the Caixin PMI figures.

Earlier in Japan, household spending for February slumped 3.8% year-on-year, compared to a 1.7% decline seen. On a monthly basis however it rose 2.5%, beating the expected 0.4% rise.

Separately, national core CPI fell 0.2% for February year-on-year as expected, while unemployment dipped to 2.8% from 3.0%. Provisional industrial production for February rose 2.0% month-on-month, beating the expected 1.2% increase.

Australia reported private sector credit for February up 0.3%, missing a 0.5% gain expected month-on-month.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, eased 0.10% to 100.35.

Overnight, the dollar rose against a basket of major currencies on Thursday, after a flurry of bullish comments from Federal Reserve officials offset news that the Trump administration is studying ways to penalize currency manipulators.

The greenback dipped briefly, after CNBC reported Thursday, the Trump administration is “assessing the scope of its power to penalize countries whose currencies it believes are undervalued”.

In what was quiet day on the economic data front, better than expected U.S. gross domestic product (GDP) and a flurry of bullish comments from Cleveland Fed President Loretta Mester and San Francisco Fed President John Williams supported upside momentum in the greenback.

The Commerce Department earlier reported that U.S. gross domestic product grew faster than previously reported in the fourth quarter.

Cleveland Federal Reserve reiterated her hawkish view concerning interest rate hikes Thursday, as she said that “further removal of accommodation via increases in the fed funds rate will be needed” should economic conditions “evolve as anticipated”.

Fed President John Williams, tapered some of his bullish rhetoric on the U.S. economy, after he said even though the economy shows “consistent” and “encouraging” signs, “housing still isn’t quite back”.

Meanwhile, sterling held firm a day after Prime Minister Theresa May triggered Article 50.