The recent rout in Asian equities having now finally paused has allowed the safe haven Japanese Yen to likewise catch its proverbial breath. The Japanese Yen gave up some of the gains earned this week after yesterday saw the Yen have its largest single day rise in 2015. For analysts, the situation in China is swaying sentiment. And the next big question is whether Beijing’s so-called safeguards, which were rapidly put in place to stem the equities blood-letting, will be sustainable. Chinese equities have lost nearly a third in value in the past month. The USD/JPY pair was trading at 121.3750 Yen, a gain of 0.6300%.
The improved situation on China’s bourses helped to provide a lift to commodity-linked currencies, however that lift was short lived for the Australian and New Zealand Dollars. As reported at 11:32 am (BDT) the AUD/USD was trading lower at $0.7425, down 0.05% on the day, off the 6-year low as the pair struck $0.7392 and well off the session peak at $0.7492. The NZD/USD was trading at $0.6714, down 0.18%; the pair ranged between $0.6699 and $0.6754.
Fed’s Protocol Disappoints Dollar Bulls
In the US, the release of the Federal Reserve’s meeting protocols from June failed to provide any support for Dollar bulls. According to the president of the San Francisco branch of the US central bank, more data on inflation targets being on the proper trajectory will have to be seen. Only then can they consider a change to the existing interest rate environment.