Friday, 1 September 2017

What’s next? – USDJPY 01.09.17

Posted by Anonymous at 10:07 Labels:

USDJPY

The dollar/yen was up 0.07 percent as of 04:25 GMT on Friday to trade at 110.03, as market participants digest downbeat Japanese data and prepared for a heavy-data session.

The US dollar index, which tracks the greenback against six major rivals, was trading at 92.60 by the time of this writing, down 0.04 percent.

The pair is once again affected by changes in the risk-on/risk-off balance, as joint military drills between South Korea and the US raised geopolitical concerns in the Korean peninsula.

On Thursday, China’s Defense Ministry spokesman Ren Guoqiang said during a monthly briefing that Beijing will never allow war or chaos on its doorstep.

Earlier this week, the dollar came under pressure following a missile launch from North Korea which violated Japan’s airspace and called for a new meeting of the UN Security Council.

The greenback stopped its recovery on Thursday after downbeat economic data reduced expectations for a third rate hike later this year.

According to Fed funds tracked by CME Group’s FedWatch program, market participants are currently pricing in a 36 percent probability of a 25 basis points interest rate hike by December.

The core PCE price index saw a 1.4 percent growth rate in July, marking the weakest year-over-year advance since December 2015. Personal spending rose by 0.3 percent in July, a tick below analysts’ expectations but above a previous reading of 0.2 percent. Pending home sales fell 0.8 percent in July against an initially forecasted 0.5 percent increase.

Ahead in the session, market players will be focusing on average hourly earnings, nonfarm payrolls and unemployment rate for August, which are all set for release as of 12:30 GMT.

Also, Markit Economics will present its manufacturing PMI at 13:45 GMT. The ISM will release its own manufacturing PMI at 14:00 GMT and Michigan University consumer expectations and sentiment are due for publishing by the same time.

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