Friday, 13 October 2017

What’s next? – USDJPY 13.10.17

Posted by Valentine at 10:55 Labels:

USDJPY

The dollar/yen was 0.34 percent lower as of 07:20 GMT on Friday, trading at 111.89, with safe haven yen strengthening ahead of inflation data in the US.

The US dollar index, which gauges the greenback against a basket of six major rivals, was trading at 92.88 by the time of this writing, 0.02 percent lower.

No relevant data was released in Japan today. However, traders counted on trade figures from China earlier this morning. Chinese trade balance in USD came in at $28.47 against expectations for a $39.5 billion surplus from a prior month $41.99 billion.

China’s exports jumped 8.1 percent year-over-year in September, while imports rose by 18.7 percent. Strong data comes in ahead of a major Communist Party Congress.

On Thursday, the US Labor Department said initial jobless claims dropped by 15,000 to a seasonally adjusted 258,000 for the week ended October 7, exceeding a forecasted 7,000 draw.

In other news, the producer price index increased 0.4 percent in September and 2.2 percent on yearly basis, up from the previous month reading of 2.0 percent.

Ahead in today’s session, traders will be paying attention to the release of US consumer price index and retail sales for September as of 12:30 GMT. Business inventories for August at 14:00 GMT, along with Michigan University consumer expectations and sentiment.

Investors will also be monitoring speeches from FOMC officials in the day. Rosengren, Kaplan and Powell are due to speak as of 12:30 GMT, 15:30 GMT and 17:00 GMT respectively.

The Federal Open Market Committee is currently divided in two groups. Those FOMC officials who want to increase interest rates for a third time this year and others who believe inflation remains too weak for the economy to deal with another hike.

Minutes from the Fed’s September policy meeting showed that inflation represents one of the main concerns for the US central bank.

According to Fed funds tracked by CME Group’s FedWatch program, investors are pricing in a 86.7 percent chance of a 25 basis points interest rate hike by December.

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