EUR/JPY Weekly Fundamental Analysis – May 16-20, 2016 -Forecast

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Published: May 14, 2016, 05:26 UTC

The EUR/JPY gained 0.56% this week to close at 122.86 as the yen weakened as well as the euro. Bank of Japan chief Haruhiko Kuroda repeated a pledge that

EUR/JPY Weekly Fundamental Analysis – May 16-20, 2016 -Forecast

The EUR/JPY gained 0.56% this week to close at 122.86 as the yen weakened as well as the euro. Bank of Japan chief Haruhiko Kuroda repeated a pledge that he was ready to unleash more stimulus measures to boost the sagging economy, comments that would normally dampen the currency.

Kuroda said the central bank “doesn’t have to wait” to launch more monetary easing as it gauges the impact of its negative-rate policy. But coming after weeks of such threats and promises from top officials, the markets appeared to have deaf ears.

Talk of more action increased after prominent Japanese academic Takatoshi Ito said on Thursday Japan’s central bank may expand monetary stimulus either in June or July. Ito has close ties to BOJ Governor Haruhiko Kuroda.

For his part, Kuroda said the BOJ won’t hesitate to take further easing steps if necessary, adding that there were still large downside risks to Japan’s economy. The BOJ introduced negative interest rates earlier this year, but that has had little impact on the yen or economic data.

“I foresee a major reversal on the yen,” said Juan Perez, currency strategist at Tempus Consulting in Washington, adding that he believes the BOJ will act aggressively at its next policy meeting in June.

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.

Major Economic Events for the week:


	Cur.	Event	Actual	Forecast	Previous
Tuesday, May 17, 2016
	GBP	CPI (YoY) (Apr)		0.5%	0.5%
	USD	Building Permits (Apr)		1.130M	1.076M
	USD	Core CPI (MoM) (Apr)		0.2%	0.1%
Wednesday, May 18, 2016
	JPY	GDP (QoQ) (Q1)		0.1%	-0.3%
	GBP	Average Earnings Index +Bonus (Mar)		1.7%	1.8%
	GBP	Claimant Count Change (Apr)		4.0K	6.7K
	EUR	CPI (YoY) (Apr)		-0.2%	-0.2%
	USD	Crude Oil Inventories			-3.410M
Thursday, May 19, 2016
	AUD	Employment Change (Apr)		12.5K	26.1K
	GBP	Retail Sales (MoM) (Apr)		0.5%	-1.3%
	USD	Philadelphia Fed Manufacturing Index		3.5	-1.6
Friday, May 20, 2016
	CAD	Core CPI (MoM) (Apr)		0.1%	0.7%
	CAD	Core Retail Sales (MoM) (Mar)		-0.5%	0.2%
	USD	Existing Home Sales (Apr)		5.40M	5.33M