Tuesday, 1 August 2017

What’s next? – USDJPY 01.08.17

Posted by Anonymous at 10:04 Labels:

USDJPY

The dollar/yen was down 0.06 percent as of 05:15 GMT on Tuesday to trade at 110.19 as the American currency extended previous losses on the back of rising political concerns.

The Trump administration is under heavy scrutiny as faces continue to change this week, including the president’s chief of staff and communication director, setting a context of instability and boosting uncertainty over key economic promises.

Traders fear that President Trump won’t be able to push its economic agenda in Congress, especially the American Health Care Act, meant to repeal and replace so-called Obamacare, and a massive tax reform aimed reducing the burden on the American people.

On Monday, the dollar remained close to fourteen-month lows against a basket of six major rivals, with market players looking ahead of key inflation and employment data in hope that these will contribute to a sustainable recovery in the short term.

This particular pair is strongly affected by risk on / risk off sentiment. This week, July’s employment report will set the tone for future weeks and possibly modify expectations for a December Federal Reserve interest rate hike, which currently stand at 42.5 percent.

In economic news, the National Association of Realtors said pending home sales increased by 1.5 percent in June compared to the prior month.

Ahead in the day, the pair’s direction will be determined by the core PCE price index and ISM manufacturing PMI in the United States. No relevant releases are scheduled in Japan.

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