JPY rose as traders cut riskier positions in other higher-yielding currencies after China reported stronger than expected Consumer Price Index (CPI) rose 2.7% and Producer Price Index (PPI) jumped 5.4% in February provided fresh arguments for policy tightening sooner than later, USD/JPY slipped to 90.22 day low yesterday after number of Australia employment increased smaller than expected in February trimmed expectation of Reserve Bank Australia (RBA) to raise interest rates next month and act as a factor to for profit taking in AUD. The economy grew 0.9% in Japan was slower than the preliminary estimate in the fourth quarter as capital spending rose less than initially reported and private inventories subtracted from growth added pressure to the Bank of Japan (BOJ) to ease monetary policy further on meeting next week, USD/JPY rebounded to 90.71 day high after U.S. released weekly Jobless Claims slightly higher than expected at 462,000 but Trade Deficit in January narrowed to $37.29 billion provided support to USD. Forecasts USD/JPY will be supported at 90.30-50 with resistance at 91.00-30 today.

Strong Chinese inflation data and other economic figures shown board-based strength added to expectations that Beijing would take more monetary tightening steps and let the Yuan rise, cross trades against JPY fell as investors cut riskier assets pressured EUR/USD down to 1.3620 day low yesterday. The Swiss National Bank (SNB) held interest rates steady at 0.25% and said it would fight an excessive appreciation of CHF decisively as it seek to firm up a strengthening economic recovery, intervention fear in CHF given support to EUR and pushed EUR/USD up to 1.3687 day high after mix economic data in U.S. failed to give investors direction and European Central Bank (ECB) Governing Council member Mersch said the Euro Zone economy’s recovery was under way though it was likely to be uneven and risks were broadly balanced added that ECB made decision to keep interest rates unchanged was appropriate and the abundant liquidity would be absorbed when the time was right. Forecasts EUR/USD will be heavy at 1.3700-30 with support at 1.3600-30 today.

Economic and political concerns hampered sentiment towards GBP, it touched 1.4948 day low against USD yesterday. The sell–off had lost momentum as there was a bit of fatigue in the bear-trade and so much bad news had been priced in, GBP/USD recovered to 1.5066 day high after mixed U.S. economic data. Forecasts GBP/USD will be capped below 1.5080-1.5100 with support at 1.4950-80 today.

Neither the information nor any opinion expressed constitutes an offer to buy or sell any currency pairs, FEIB accepts no liability for any damages or losses arising from use of this document or its contents. See http://www.feib.com.tw/foreignexchange/index.aspx  for further FX information. FEIB Margin Trading Desk, Tel : (02) 2376-5680~2 , Toll free: 0809-085818. (Day Shift) Anita Li, Gary Tseng, Michael Liu, Elaina Chang, Ivy Wu (Night Shift) Simon Chen, Eric Pan.