Tuesday, 3 October 2017

What’s next? – USDJPY 03.10.17

Posted by Valentine at 10:18 Labels:

USDJPY

The dollar/yen was 0.24 percent up as of 07:05 GMT on Tuesday to trade at 113.01, as the greenback held near 1-½ month highs on the back of upbeat US manufacturing data.

The US dollar index, which gauges the greenback against a basket of six major rivals, was trading at 93.60 by the time of this writing, up 0.21 percent.

The Institute for Supply Management said on Monday its manufacturing PMI for September came in at 60.8, outperforming expectations for a 58.0 reading and a prior 58.8 from August.

Better-than-expected economic data increased expectation for further monetary policy adjustments from the Federal Reserve later this year.

According to Fed funds tracked by CME Group’s FedWatch tool, traders are currently pricing in a 76.7 percent probability of a 25 basis points rate hike by December.

In the light of these developments, the benchmark 10-year Treasury yield settled at a 2.351 percent rate after briefly touching three-month peak of 2.371 percent.

The pair extended gains last week as Federal Reserve Chairwoman insisted on the fact that adjusting monetary policy “too gradually” could overheat the labor market.

In this line, market players will be paying to the latest employment figures from the United States, including nonfarm payrolls, average hourly earnings and the unemployment rate for Sep.

Also, the pair was supported by the Bank Of Japan’s dovish rhetoric on monetary policy. BOJ Governor Haruhiko Kuroda has recently said that the regulator won’t touch its stimulus for now.

Japanese Prime Minister Shinzo Abe announced last week that the parliament was being dissolved and snap elections were called for October 22.

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