Aussie Conference Board Leading Index

The May Conference Board Leading Index came in at 0.3%, better than the prior reading of 0.1%.  However, the market seems content to sit right here early in the Tokyo morning with equities edging higher, shadowing the results of the US markets earlier.

Japan’s Corp Services Price Index

Japan’s June Corporate Services Price Index is one of very few releases on a very light Asian economic calendar for the day, which was released slightly more deflationary than expected at -1.0%, versus the survey at -0.9%. This is the 21st consecutive year over year drop. The Yen gained a light trading at session highs against the majors.

Aussie Q2 Import/Export Prices

The 2nd quarter Export Price Index came in above expectations, as did the Import Prices; the AUD initially gained mild bid on this inflationary release.

Import Price Index (QoQ) – Survey:1.0%   Actual:1.9%   Prior:0.3%

Export Price Index (QoQ) – Survey:13.5%   Actual:16.1%   Prior:3.8%

EUR/JPY Selling Off

The Yen crosses have been under pressure following Bernanke’s testimony, which left a lot to be desired for the bulls lout there. For the EUR/JPY cross we see the 50% retracement in striking distance, where we could see some support for the pair.

BOJ’s Yamaguchi on the Wire

• Japan economy shows further signs of recovery.
• Global markets volatile, warrant close watch.
• Export recovery gradually spreading to domestic.
• BOJ to keep very accommodative policy.
• Level of Japan recovery isn’t sufficient.
• Recovery differs among regions, industries.
• Core price declines to ease as output gap narrows.
• Crucial to boost growth to beat deflation.
• Expects core prices to rise in fiscal 2011.
• Avoiding emerging economy overheating is crucial.

BOJ Meeting Minutes

The Bank of Japan’s June Meeting Minutes were released to minimal market reaction, the details of the release are as follows:

• BOJ members agreed new measures will help price stability.
• A few BOJ members said should they should examine other measures.
• Members said new measures shouldn’t hurt rate policy.
• Members said to maintain extremely accomodative policy.
• Some members said duration of new program should be limited.
• One BOJ member saw some downside risk for the second half of the fiscal year.
• Members agreed new measures will help price stability.

RBA July Meeting Minutes

The RBA’s July Meeting Minutes were relatively dovish and not well received  by the market as we saw the Aussie pare its earlier gains and move lower on the release that stressed the affect of external and regional forces on the Australian economy.

• RBA expects underlying inflation rate moderated to below 3%.
• To monitor the extent Asia can grow as western economies slow.
• Some moderation in Asian growth ‘desirable.’
• Tests may have significant impact on markets and confidence.
• Sees some signs conditions in Australia housing market eased.
• Waiting to gauge impact of European Bank stress tests.
• Signs Australia is moving from public to private demand.
• Asia growth returning to more sustainable pace.
• RBA to see if new data ‘materially’ changes inflation outlook.

USD/JPY Gaining a Bid

The JPY has so far been the lone mover in the Asian session, with the USD/JPY pair currently testing the 87 handle. A break higher with some follow through could push the pair to the 88 handle where we can currently see the 61.8% retracement of the latest short-term move and the fast approaching 4-100hr moving average, perhaps there we can find some short-term resistance.