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USD/JPY Weekly Fundamental Analysis – February 15-19, 2016 -Forecast

By:
Barry Norman

Weekly Analysis and Recommendation: The USD/JPY was the focal point of safe haven moves this week ending at 113.22 seeing a drop of 3.15%.  The U.S.

USD/JPY Weekly Fundamental Analysis – February 15-19, 2016 -Forecast

usdjpy weekly bnsnla
Weekly Analysis and Recommendation:

The USD/JPY was the focal point of safe haven moves this week ending at 113.22 seeing a drop of 3.15%.  The U.S. dollar traded mixed against other major currencies and rose against the Japanese yen for the first time this week as the economic data from the country came out positive.

The U.S. Commerce Department reported Friday that the country’s retail and food services sales for January were 449.9 billion U.S. dollars, an increase of 0.2 percent from the previous month, and 3.4 percent above January 2015.

The latest reading was in line with market consensus and renewed investors’ expectation for the Federal Reserve to raise interest rates this year. The greenback inched up 0.8 percent against the Japanese yen during the session on Friday. The dollar index, which measures the greenback against six major peers, was up 0.42 percent at 95.967 in late trading.

The dollar rebounded against the yen on Friday as solid US retail sales data and rising oil prices lifted sentiment on global markets after a punishing week.

The dollar rebounded 0.8 per cent to ¥113.25 around 2200 GMT from the same time on Thursday. During the Thursday session, it had fallen to ¥110.99, its weakest level since October 2014. “For the first time in 10 trading days the US dollar ended the day higher against the Japanese yen thanks to better-than-expected retail sales and a rebound in oil prices,” said Kathy Lien of BK Asset Management.

US retail sales rose 0.2 per cent in January and December’s drop was revised upward to a 0.2 per cent gain. “This report confirms our view that consumers are doing most of the heavy lifting despite stock market volatility,” said Chris Christopher of IHS Global Insight. “The consumer outlook for the next couple of years remains favorable.”

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.

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Major Economic Events for the week:

Cur. Event Actual Forecast Previous  
Monday, February 15, 2016
      United States – Presidents’ Day
      Canada – Family Day
    CNY Trade Balance (Jan)   58.85B 60.09B  
Tuesday, February 16, 2016
    GBP CPI (YoY) (Jan)   0.3% 0.2%  
    EUR German ZEW Economic   3.2 10.2  
Wednesday, February 17, 2016
    GBP Average Earnings Index   1.9% 2.0%  
    GBP Claimant Count Change (Jan)   -3.0K -4.3K  
    USD Building Permits (Jan)   1.200M 1.204M  
    USD PPI (MoM) (Jan)   -0.2% -0.2%  
Thursday, February 18, 2016
    AUD Employment Change (Jan)   15.0K -1.0K  
    CNY CPI (YoY) (Jan)   1.9% 1.6%  
    USD Philadelphia Fed   -2.8 -3.5  
    USD Crude Oil Inventories     -0.754M  
Friday, February 19, 2016
    GBP Retail Sales (MoM) (Jan)   0.8% -1.0%  
    USD Core CPI (MoM) (Jan)   0.2% 0.1%  
    CAD Core CPI (MoM) (Jan)   0.2% -0.4%  
    CAD Core Retail Sales (MoM) (Dec)   -0.5% 1.1%

Upcoming Government Bond Auctions

Date Time Country 

Feb 15 13:00 Norway Details of bond auction on Feb 17

Feb 17 11:03 Sweden Holds bond auction

Feb 17 11:05 Norway Holds bond auction

Feb 17 11:30 Germany Euro 5bn 0.5% Feb 2026 Bund

Feb 17 11:30 UK New Jul 2026 Gilt auction

Feb 18 10:30 Spain Holds bond auction

Feb 18 11:50 France Holds bond auction

Feb 18 17:20 Sweden Details of I/L auction on Feb 25

Feb 19 11:10 Italy Details of BTP€i/Zero-coupon auction

 

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