What’s next? – USDJPY 18.04.18

The dollar was trading 0.31 percent higher vs the Japanese yen at 107.33 as of 08:05 GMT on Wednesday as the dollar recovered positions on the back of upbeat economic data.

Government figures showed that housing starts rose 1.9 percent to 1.319 million units. Also, the Federal Reserve said industrial output increased 0.5 percent in March.

The US dollar index, which gauges the greenback against six major currencies, was trading 0.08 percent higher at 89.30 by the time of this writing.

Also contributing to a better market sentiment were reports that former CIA and current Secretary of State Director Mike Pompeo travelled to North Korea to gather with Kim Jong Un to prepare topics ahead of a scheduled meeting with President Donald Trump.

In other news, China said it would impose deposits of up to 178.9 percent on American sorghum imports. As China’s decision is expected to be temporary, no strong reactions were spotted. Overall, analysts took this as a minor development in the US-China trade conflict.

Ahead in this session, attention will be mainly directed to the European economic calendar. In US hours, Fed’s beige book is due for release at 18:00 GMT.

No major reports are due in Japan. Traders are also focus on a meeting between Japan Prime Minister Shinzo Abe and US President Donald Trump on Tuesday and Wednesday.

Both leaders are expected to discuss the possibility of a two-way free trade agreement. While Japan is not interested in such sort of deal, US officials could benchmark information pointing at Tokyo for manipulating its currency, as the US Treasury semi-annual currency report showed.

The results of this meeting will offer a clearer vision for market participants, allowing them to better position themselves for the pair. By now, we suggest keeping an eye on the news.

FortFS