EUR/JPY Fundamental Forecast – February 10, 2016

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Published: Feb 9, 2016, 05:11 UTC

Analysis and Recommendations: The EUR/JPY fell to 128.54 as traders moved to the yen for safety this morning. Worldwide financial turmoil has halted the

EUR/JPY Fundamental Forecast – February 10, 2016

Analysis and Recommendations:

The EUR/JPY fell to 128.54 as traders moved to the yen for safety this morning. Worldwide financial turmoil has halted the U.S. dollar’s 1 1/2-year climb as traders unwind bets that the Fed will tighten borrowing costs this year after increasing rates in December for the first time in almost a decade.

“The yen by default looks to be the safest,” said Takao Hattori, senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities Co. in Tokyo. “Soft U.S. data is raising speculation that the pace of rate increases will be slow. Investors have already stocked up on dollars, so they don’t need more.”

Global currency volatility rose to 11.77 percent, according to a JPMorgan Chase & Co. gauge. Japanese government bonds of all maturities rallied Tuesday, with the five-year yield dropping 4.5 basis points, or 0.045 percentage point, to a record minus 0.225 percent.

Bets on a Fed interest-rate increase before year end dropped to 30 percent on Monday, from 53 percent on Friday, futures trading shows. Focus will turn to Fed Chair Janet Yellen’s Congressional testimony in Washington this week for clues on how policy makers view the likelihood of a near-term increase in the benchmark.

FxEmpire provides in-depth analysis for each asset we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports, which covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.

Today’s economic releases:

Cur.	Event	Actual	Forecast	Previous
	China – Lunar New Year
GBP	BRC Retail Sales Monitor (YoY) (Jan)	2.6%	0.4%	0.1%
AUD	NAB Business Confidence (Jan)	2	2	3

Upcoming Economic Events that you should be monitoring:

Wednesday, February 10, 2016

Cur.	Event	Actual	Forecast	Previous
	China – Lunar New Year
USD	API Weekly Crude Oil Stock			3.837M
NZD	Electronic Card Retail Sales (MoM)		0.3%	-0.2%
AUD	Westpac Consumer Sentiment		-1.0%	-3.5%
AUD	HIA New Home Sales (MoM) (Dec)			-2.7%
GBP	Industrial Production (MoM) (Dec)		-0.1%	-0.7%
GBP	Manufacturing Production (MoM)		0.1%	-0.4%
GBP	NIESR GDP Estimate			0.6%
USD	Fed Chair Yellen Testifies
USD	Crude Oil Inventories		3.933M	7.792M
USD	FOMC Member Williams Speaks
USD	Federal Budget Balance (Jan)		45.0B	-14.0B