Currency Analyst since 2010

Feb. 28: Asian session

Asian shares fell after Chinese yuan slid by the most since 2008 on speculation the government will broaden the currency’s trading band. MSCI Asia Pacific Index declined 0.2%, while Japanese Nikkei is down by 0.9%.

USD/JPY slid to 101.54. Japanese yen strengthened as rising tensions in Ukraine boosted haven demand. Moreover, traders are speculating that the Bank of Japan may delay expanding stimulus with the inflation rate at a 5-year high. Japanese CPI added 1.3% in January.

AUD/USD is hovering around $0.8950 after having found support at $0.8900 in the US trade. Aussie still looks extremely vulnerable as the Chinese yuan extends losses. China manufacturing PMI release on Saturday could exacerbate the AUD weakness. NZD/USD moved higher in Asia on the strong NZ business confidence data (70.8 vs. prior 64.1). Kiwi faced resistance at $0.8415.

EUR/USD opened at $1.3710 and is now testing levels below $1.3700. Yesterday euro found support in the $1.3640 area. GBP/USD is little changed in the $1.6680 zone.

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