May 13: Asian session
US dollar strengthened versus 12 of its 16 major peers after Treasury benchmark 10-year yields rose to the 7-week high and before the speech of the Philadelphia FRB President Charles Plosser tomorrow.
USD/JPY is trading below the high of 102.15 set earlier today. Yen weakened breaching the 102 per dollar for the first time in four-and-a-half years as G7 finance chiefs indicated they’ll tolerate a slide in the currency for now as they focus on Japan’s recovery strategy.
AUD/USD opened at the parity, but is now trading by 15 pips below this level. Aussie extended its slump as Treasurer Wayne Swan is forecast to project a fifth and sixth year of budget deficits tomorrow. NZD/USD recovered from $0.8260 rising above $0.8300. New Zealand’s House Price Index added 0.8% in April.
EUR/USD is trying to hold above $1.2950. Market sentiment towards the euro remains subdued after the ECB president Mario Draghi told after the G7 meeting that the bank is considering buying asset-backed securities to support the economy. Eurogroup gathers in Brussels today to discuss the economic situation. The euro zone’s finance ministers will also discuss the approval of the first tranche of bailout funds for Cyprus and the next one for Greece. Traders are looking forward to the euro zone’s Q1 GDP release on Wednesday.
GBP/USD is up to $1.5370 from Friday’s low of $1.5313. March UK trade deficit figures on Friday overcame the forecast.USD/CAD is trading above 1.0100, though limited by the resistance at 1.0140. Last Friday's data showed Canadian emloyment increased in April after a drop in March, but came below the forecast.