Yen May Fall Further in Cautiously Optimism Start to Trading Week

TALKING POINTS – YEN, AUSTRALIAN DOLLAR, STOCKS, EUROZONE CPI, EURO

• Yen falls, Aussie and Kiwi Dollars rise in risk-on Asia Pacific trade
• S&P 500 futures hint the upbeat mood has scope for follow-through
• Euro unlikely to find a potent catalyst in revised Eurozone CPI data

The sentiment-geared Australian and New Zealand Dollars narrowly outperformed while the anti-risk Japanese Yen edged lower as Asia Pacific markets started the week in a relatively upbeat mood, shrugging off a negative lead from Friday’s Wall Street session. Bellwether S&P 500 futures are pointing higher, hinting at more of the same in the hours ahead.

The absence of fresh fodder fueling concerns about the many potential headwinds menacing investors – from political instability in Europe to shaky emerging markets – might be reason enough for a bit of a respite. Hopes for confirmation of a dovish pivot in Fed policy with this week’s FOMC policy announcement may be playing a part as well (alas, they are likely to be disappointed).

A revised set of Eurozone CPI figures amounts to the only of noteworthy bit on the European economic calendar. It is expected to confirm that headline inflation slowed to 2 percent on-year in November from 2.2 percent in the prior month, marking a three-month low. The release is unlikely to mean much for the Euro considering its limited implications for near-term ECB policy.

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ASIA PACIFIC TRADING SESSION

EUROPEAN TRADING SESSION

** All times listed in GMT. See the full economic calendar here.

FX TRADING RESOURCES

— Written by Ilya Spivak, Currency Strategist for DailyFX.com

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