Talking Points:

Russian Trade Balance Data May Rekindle Risk Aversion into the Week-End
Yen Sold as Asian Stocks Rise on Upbeat US Data, NZ Dollar Corrects Lower
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Emerging-market jitters may renew pressure on risky assets in the final hours of the trading week. Russian Trade Balance figures are expected to show the smallest surplus in over two years at $11.6 billion. The announcement threatens to shine the spotlight on an increasingly precarious situation that looks dangerously likely to result in either an acute budget crisis or the introduction of capital controls.

Needless to say, neither alternative bodes well for sentiment. With that in mind, a data set that fuels fears of Russia-driven market dislocation may renew the push to liquidate risk-geared positions set off earlier in the week. That is likely to yield another leg upward in the Japanese Yen and weigh on higher-yielding currencies such as the Australian Dollar.

Currency markets were little-changed in overnight trade, with most of the majors mired in consolidation mode. The Yen narrowly underperformed as stocks advanced, sapping haven demand. The MSCI Asia Pacific regional benchmark equity index added 0.7 percent following upbeat US Retail Sales data published earlier in the day. The US is a leading export market for Asian firms and a pickup in retail activity may have been interpreted as supportive of cross-border demand prospects. The New Zealand Dollar also declined as prices continued to digest the rally after the RBNZ policy announcement.

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