EUR/JPY Fundamental Forecast – February 9, 2016

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Published: Feb 8, 2016, 05:51 UTC

Analysis and Recommendations: The EUR/JPY added 23 points as the yen declined after a disappointing current account print. The fell 23 points against the

EUR/JPY Fundamental Forecast – February 9, 2016

Analysis and Recommendations:

The EUR/JPY added 23 points as the yen declined after a disappointing current account print. The fell 23 points against the US dollar. The EURJPY is trading at 130.57. The Japanese currency has more than recouped the tumble triggered when the Bank of Japan last week unexpectedly decided to charge lenders for some of their excess reserves held at the central bank. Prospects for higher interest rates in the U.S. are receding on speculation the Federal Reserve can’t tighten monetary policy further against a backdrop of global turmoil. The euro is heading for its biggest weekly advance since 2011 even as the European Central Bank reviews its monetary stance.

“General risk-off has led to some appreciation of the yen, but it’s also the dollar side of the story that’s playing out as a bigger driver this time,” said Shinichiro Kadota, a foreign-exchange strategist at Barclays Plc in Tokyo. “There are some questions about how effective and how much more scope for easing there is for the ECB and BOJ.”

China’s January foreign reserves data, scheduled for release on Sunday, are forecast to decline to $3.21 trillion from $3.33 trillion. China’s dollar stash been falling since the middle of 2014. Outflows accelerated from August 2015, as fears of yuan depreciation mounted.

“Current risk-off affecting just the yen and the euro could really become serious if U.S. jobs data are bad and Chinese foreign reserves shrink further,” said Naohiko Nomoto, an economist in New York at Bank of Tokyo-Mitsubishi UFJ Ltd. “The BOJ can’t halt risk aversion on its own without coordination.”

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
	New Zealand – Waitangi
JPY	Adjusted Current Account	1.64T		1.42T
JPY	Current Account n.s.a. (Dec)	0.96T	0.987T	1.144T

Upcoming Economic Events that you should be monitoring:

Tuesday, February 9, 2016

Cur.	Event	Actual	Forecast	Previous
	China – Lunar New Year
AUD	HIA New Home Sales (MoM) (Dec)			-2.7%
GBP	BRC Retail Sales Monitor (YoY) (Jan)		0.4%	0.1%
AUD	NAB Business Confidence (Jan)			3
EUR	German Industrial Production (MoM)		0.4%	-0.3%
EUR	German Trade Balance (Dec)		20.2B	19.7B
GBP	Trade Balance (Dec)		-10.35B	-10.64B
GBP	Trade Balance Non-EU (Dec)		-2.55B	-2.45B
USD	JOLTs Job Openings (Dec)		5.400M	5.431M