What’s next? – USDJPY 26.10.17

The dollar exchanged at 113.51 against the Japanese yen in early hours on Thursday, with investors awaiting reports from the US, but remaining mainly quiet as inflation data gets closer.

The US dollar index, which gauges the greenback against six major rivals, was trading at 93.46 by the time of this writing, down 0.13 percent.

No relevant data was released in Asian hours. Ahead in the session, traders await goods trade balance for September and initial jobless claims as of 12:30 GMT. Pending home sales are due for release at 14:00 GMT. FOMC member Kashkari will speak half an hour later.

Market participants are likely to take a breather ahead of US inflation data on Friday. Inflation is closely monitored by Fed policymakers when deciding about monetary policy changes.

According to Fed funds tracked by CME Group’s FedWatch tool, investors are currently pricing in more than a 90 percent chance of a rate hike by December.

In the previous session, durable goods orders and housing data were not enough to keep the American currency in green territory, helping bullion prices to shrug off a three-day losing streak.

The US Commerce Department said non-defense capital goods orders, excluding aircraft, increased by 1.3 percent in September, above an initially forecasted 1.0 percent build.

Existing home sales in the United States rose 18.9 percent in September from a prior month to a seasonally adjusted 667,000 units, a separate report from the Commerce Department showed. Analysts had estimated a 0.9 percent drop to an annual rate of 555,000 units.

Meanwhile, speculation over President Donald Trump’s decision of who will lead the Federal Reserve for the next four years drove the dollar higher on Wednesday.

New reports said on Wednesday Stanford University economist John Taylor, one of Trump’s major candidates for becoming the new Fed chair in February, was ahead in the race.

Taylor is seen as more hawkish than the current chairwoman Janet Yellen when it comes to monetary policy normalization.

Fort Financial Services