Monday, 2 October 2017

What’s next? – USDJPY 02.10.17

Posted by Valentine at 10:40 Labels:

USDJPY

The dollar/yen was 0.34 percent up as of 04:45 GMT on Monday to trade at 112.84, as the dollar continued its upward move while the yen fell under pressured due to economic data.

Earlier today, Japan released its Tankan All Big Industry CAPEX index, which came in at 7.7 percent compared to a forecasted 8.3 percent build. Third-quarter Tankan large manufacturers 22 while the non-manufacturers came in at 23, both above estimated values.

The US dollar index, which gauges the greenback against a basket of six major rivals, was trading at 93.20 by the time of this writing, up 0.34 percent.

Last week ended with downbeat economic reports in the US, although they had little effect on expectations for further monetary changes later this year.

The core personal consumption expenditures price index, one of Fed’s favorites inflation measures, saw a 1.3 percent growth in August, down from a previous month advance of 1.4 percent.

The Commerce Department said consumer spending rose by 0.1 percent last month. Consumer spending accounts for nearly two thirds of US economic activity.

According to Fed funds tracked by CME Group’s FedWatch tool, traders are currently pricing in a 81.7 percent probability of a 25 basis points rate hike by December.

Ahead in the day, market participants will be focusing on the release of Markit’s US manufacturing PMI for September as of 16:45 GMT and the same index from the Institute for Supply Management at 17:00 GMT.

The main event this week will be the release of jobs data for September in the United States. The report, which is due on Friday, could have strong effects on expectations for rate hikes and therefore, create volatility for the US dollar against key competitors such as the yen.

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