Strong Yen Offsets Positive Asian Data, Drives Mixed Asian Markets
Safe Haven Demands Push Gold Higher, Drive Commodity Flows
Mixed Monday in Asian markets
Major Asian markets (AAXJ) were trading with a mixed bias on April 11, 2016—despite the strong data releases from Asian countries. The Chinese (MCHI) Shanghai Shenzhen CSI 300 Index was among the biggest gainers, rising by 1.4%. The Indian (INDA) Nifty 50, which posted the largest gains, rose by 1.5% on the day.
Meanwhile, the Japanese (DXJ) Nikkei 225 Index was on a negative trajectory, falling by 0.44%, as the strengthening yen continued to weigh down the export-driven economy. Oceania indices were trading nearly flat, with a slight negative bias, on April 11. The Australian (EWA) S&P/ASX 200 and the Dow Jones New Zealand (VPL) indices, notably, fell by 0.12% and 0.08%, respectively.
Chinese inflation proves encouraging
The Chinese National Bureau of Statistics published its YoY (year-over-year) CPI (consumer price index) and PPI (producer price index) for March, which were in line with market consensus. The CPI came out at 2.3%—the same as one month previously—whereas the PPI showed a decline of 4.3%. This was still better than market forecasts of a 4.9% fall.
The rise in CPI was primarily attributed to the increase in food prices, particularly vegetables and pork. The PPI continued to be weighed down by the fall in mining and raw material costs.
Decent Japanese and Australian data
Meanwhile, the Japanese cabinet office just released its month-over-month core machinery orders, which showed a drop of 9.2%. This is still better than the expected 11.8% decline, and machinery orders had little impact on the market because the strengthening yen continued to weigh down Japanese markets.
At the same time, the US dollar-yen currency pair, which is inversely related to the yen itself, fell by 0.15% and was trading at 107.94 as of 12:30 PM EST. Among the other data released in Asian markets, Australian home loans came slightly below forecasts, rising by a mere 1.5%.
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