What’s next? – USDJPY 15.11.17

The dollar was trading 0.52 percent lower vs the Japanese yen at 112.86 as of 08:45 GMT, with investors awaiting a large set of economic reports later in the day, with focus on US inflation.

Earlier today, Japanese GDP was released showing an annualized growth rate of 1.4 percent in the third quarter, above expectations for a 1.3 percent. The GDP added 0.3 percent q/q.

Market players weren’t really concerned that the GDP missed the forecasted q/q 0.4 percent build as Japan is currently on track for its longest period of uninterrupted growth in 10 years.

By time of this writing, the US dollar index, which measures the greenback against six major rivals, was down 0.23 percent at 93.51 as tax bill-related concerns continued to weigh.

Republican members of the US Senate said on Tuesday the tax reform bill will involve the repeal of Obamacare’s condition that Americans should have some sort of health coverage.

The Labor Department said its producer price index for October increased by 0.4 percent. On yearly basis, the index was up 2.8 percent from a previous month rise of 2.6 percent.

A better-than-expected wholesale inflation boosted expectations for further monetary policy adjustments from the US Federal Reserve.

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.

Ahead in the day, the US consumer price index for October is due for release at 13:30 GMT, with a 0.1 percent month-on-month build seen.

The NY Empire State manufacturing index for Nov is also set for that time, as well as retail sales for Oct. Business inventories for Sep are up at 15:00 GMT, with a forecasted rise of 0.1 percent.

Upbeat inflation data from the US could boost the US dollar on higher expectations for a Fed hike next month, which would translate into a positive impulse for the USDJPY.

Fort Financial Services