AUD/JPY declines to 74.30 Wednesday’s Asian session as Australia’s Q3 GDP lagged behind consensus on QoQ.
Australia’s third-quarter (Q3) Gross Domestic Product (GDP) slipped to 0.4% on QoQ versus expectations of no change at 0.5%. Though, the yearly figure matched upbeat expectations of 1.7% growth against 1.4% prior. Elsewhere, Japan’s November month Jibun Bank Services Purchasing Managers’ Index (PMI) rose to 50.3 versus expected outcome of 50.4 and 49.7 prior.
Escalation of trade war concerns remains to be the key driver of the market’s recent risk-off sentiment. The United States (US) and China are now signaling phase-one in 2020 versus the previous expectations of it by the year-end. While the US Trade Secretary Wilbur Ross leads the Trump administration speakers to convey their bargaining tricks, China’s retaliation to the Hong Kong Act portrays the other extreme. The latest on this comes from Reuters claiming that the US House has passed a bill demanding sanctions on senior Chinese officials.
Also contributing to the risk sentiment are increasing odds of the US President Donald Trump’s impeachment. The recent news from Reuters mentions that the US House Intelligence Committee has approved US President Trump's impeachment report.
In a reaction to the market’s risk-off, the US 10-year treasury yields slipped more than 10 basis points to sub-1.72% on Tuesday, taking rounds to 1.725% by the press time.
Having witnessed initial market reaction to the Aussie data and risk catalysts, markets will now look forward to China’s Caixin Services PMI, bearing a consensus of 52.7 against 51.1 prior, for the November month outcome, could entertain the pair traders.
Source : FX Street