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28 May 2013
Flash: AUD/JPY settles back to long-term range – Westpac
FXstreet.com (Barcelona) - The AUD/JPY is slipping back towards its long-term average with the 90-100.00 range accounts for about 12% of trade since 1983.
In addition, negotiations over a free trade agreement between Australia and Japan reportedly suffered a setback as Ford announced it would close its Australian manufacturing operations just as Japan is pushing for removal of the remaining 5% tariff on imported cars. Australia’s trade minister also drew attention to Japan’s monetary policy.
According to Global FX Strategist Sean Callow at Westpac, “The yield pickup offered on AUD over JPY in the 2-year area is still trending slightly lower. While yield spreads have been a poor guide to the AUD/JPY trend since late 2012, they are not irrelevant. Japanese investors were heavy sellers of AUD bonds from late 2012 into Q1 2013 and have shown no particular interest recently to resume purchases.”
In addition, negotiations over a free trade agreement between Australia and Japan reportedly suffered a setback as Ford announced it would close its Australian manufacturing operations just as Japan is pushing for removal of the remaining 5% tariff on imported cars. Australia’s trade minister also drew attention to Japan’s monetary policy.
According to Global FX Strategist Sean Callow at Westpac, “The yield pickup offered on AUD over JPY in the 2-year area is still trending slightly lower. While yield spreads have been a poor guide to the AUD/JPY trend since late 2012, they are not irrelevant. Japanese investors were heavy sellers of AUD bonds from late 2012 into Q1 2013 and have shown no particular interest recently to resume purchases.”