The EUR/JPY is trading at 123.31 seeing a gain of 1.08% this month but the pair is down almost 6% year to date. The euro is trading near its lowest level
The EUR/JPY is trading at 123.31 seeing a gain of 1.08% this month but the pair is down almost 6% year to date. The euro is trading near its lowest level at the end of the month while gaining some momentum mid-month. As Prime Minister Abe is set to cancel or delay the sales tax increase the yen is beginning to rebound but overall economic data has remained weak. The Bank of Japan) will likely add monetary stimulus to the struggling economy over the coming months as the country’s battle against deflation continues. Despite ongoing economic challenges, the central bank opted to keep its monetary policy stance unchanged following the April 28th meeting, continuing its policy of “Quantitative and Qualitative Monetary Easing with a Negative Interest Rate”. National headline inflation dipped back into negative territory in March as prices declined by 0.1% y/y, compared with a +0.3% reading a month before.
Japan’s real GDP growth outlook remains muted, with output growth averaging 0.5% y/y in 2016-17 on the back of subdued export sector performance and weak domestic demand; soft wage growth and consumers’ deflationary mindset will discourage spending by households.
The euro remains near the bottom of its trading range despite the array of internal headwinds and turmoil in global markets, the Eurozone economy registered a strong start to the year. Real GDP advanced by a solid 0.6% q/q in the first quarter of 2016, beating consensus expectations of 0.4%. This represents the best outturn in a year, twice the rate of growth recorded in the prior quarter and the final boost needed to lift the Eurozone economy above its pre-crisis peak in 2008. Consumer spending will likely prove to be the main impetus driving the acceleration thanks to ongoing improvements in labour market conditions. Indeed, Eurozone unemployment continues to edge lower.
Traders are not expecting any change from the ECB this week but Mario Draghi is expected to give some insight into inflation worries in the Eurozone.
FxEmpire provides in-depth analysis for each currency and commodity 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 recent analysis and information in our weekly reports and we provide daily updates and outlooks.
Upcoming Economic Events that you should be monitoring:
Time | Cur. | Imp. | Event | Actual | Forecast | Previous | ||
Wednesday, June 1, 2016 | ||||||||
CNY | Manufacturing PMI (May) | 50.0 | 50.1 | |||||
AUD | GDP (QoQ) (Q1) | 0.8% | 0.6% | |||||
CNY | Caixin Manufacturing PMI (May) | 49.3 | 49.4 | |||||
GBP | Manufacturing PMI (May) | 49.6 | 49.2 | |||||
USD | ISM Manufacturing PMI (May) | 50.4 | 50.8 | |||||
Thursday, June 2, 2016 | ||||||||
AUD | Retail Sales (MoM) (Apr) | 0.3% | 0.4% | |||||
GBP | Construction PMI (May) | 52.0 | 52.0 | |||||
EUR | Interest Rate Decision (Jun) | 0.00% | 0.00% | |||||
USD | ADP Nonfarm Employment Change (May) | 175K | 156K | |||||
EUR | ECB President Draghi Speaks | |||||||
Friday, June 3, 2016 | ||||||||
GBP | Services PMI (May) | 52.5 | 52.3 | |||||
USD | Nonfarm Payrolls (May) | 162K | 160K | |||||
USD | Unemployment Rate (May) | 4.9% | 5.0% | |||||
USD | ISM Non-Manufacturing PMI (May) | 55.5 | 55.7 | |||||
Monday, June 6, 2016 | ||||||||
Holiday | New Zealand – Queen’s Birthday | |||||||
USD | Fed Chair Yellen Speaks | |||||||
Tuesday, June 7, 2016 | ||||||||
AUD | Interest Rate Decision (Jun) | 1.75% | ||||||
CAD | Ivey PMI (May) | 53.1 | ||||||
JPY | GDP (QoQ) (Q1) | 0.4% | ||||||
Wednesday, June 8, 2016 | ||||||||
CNY | Trade Balance (USD) (May) | 45.56B | ||||||
GBP | Manufacturing Production (MoM) (Apr) | 0.1% | ||||||
NZD | Interest Rate Decision | 2.25% | 2.25% | |||||
Thursday, June 9, 2016 | ||||||||
Holiday | China – Dragon Boat Festival | |||||||
CNY | CPI (YoY) (May) | 2.3% | ||||||
Friday, June 10, 2016 | ||||||||
All Day | Holiday | China – Dragon Boat Festival | ||||||
CAD | Employment Change (May) | -2.1K | ||||||
Sunday, June 12, 2016 | ||||||||
CNY | Industrial Production (YoY) (May) | 6.0% | ||||||
Monday, June 13, 2016 | ||||||||
Holiday | Australia – Queen’s Birthday | |||||||
Tuesday, June 14, 2016 | ||||||||
GBP | CPI (YoY) (May) | 0.3% | ||||||
USD | Core Retail Sales (MoM) (May) | 0.8% | ||||||
USD | Retail Sales (MoM) (May) | 1.3% | ||||||
Wednesday, June 15, 2016 | ||||||||
GBP | Claimant Count Change (May) | -2.4K | ||||||
USD | Fed Chair Yellen Speaks | |||||||
USD | Fed Interest Rate Decision | 0.50% | 0.50% | |||||
NZD | GDP (QoQ) (Q1) | 0.9% | ||||||
Thursday, June 16, 2016 | ||||||||
AUD | Employment Change (May) | 10.8K | ||||||
GBP | Retail Sales (MoM) (May) | 1.3% | ||||||
EUR | CPI (YoY) (May) | -0.1% | ||||||
GBP | Interest Rate Decision (Jun) | 0.50% | ||||||
Friday, June 17, 2016 | ||||||||
CAD | Core CPI (MoM) (May) | 0.2% |