What’s next? – USDJPY 14.11.17

The dollar was trading unchanged against the Japanese yen at 113.62 as of 03:00 GMT, with market participants keeping an eye on Trump’s tax reform and a series of high-impact events and data scheduled later in the day.

The US dollar index, which gauges the greenback against six major rivals, was trading at 94.40, up 0.01 percent by the time of this writing. The American currency remains under pressure as uncertainty is still high over the future of Trump’s tax bill.

Ahead in the day, investors will keep an eye on comments from central bank leaders at 10:00 GMT, including ECB President Mario Draghi, Fed Chairwoman Janet Yellen, Bank of England Gov Mark Carney and Bank of Japan Gov Haruhiko Kuroda.

On the data front, the US producer price index will be available at 13:30 GMT, with a 0.1 percent build seen for October and a 0.2 percent growth rate for the core index.

No relevant data was released in Japan. However, the Asian session was marked by downbeat data from China. China’s fixed asset investment grew 7.3 percent in October, a tick down from the previous month increase of 7.5 percent and a forecasted 7.4 percent.

Industrial production in the world’s largest manufacturing nation rose by 6.2 percent, also missing expectations of a 6.3 percent rise and a prior month 6.6 percent.

The House of Representatives is going to vote later this week on Trump’s tax reform bill, but there is plenty of uncertainty over the new regulation. The House’s tax-writing committee has recently said that it will now allow an elimination of a federal deduction for state and local taxes.

The dollar is sensitive to the tax reform as the bill could help boost economic growth and therefore increase interest rates further.

According to CME Group’s FedWatch tool, traders are pricing in more than a 90 percent chance of a 25 basis points interest rate move in December.

Fort Financial Services