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USD/JPY Weekly Fundamental Analysis – May 9 -14, 2016 -Forecast

By:
Barry Norman
Published: May 7, 2016, 05:55 UTC

The USD/JPY closed the week at 107.12 with a gain of 0.71% this week as the US dollar ended recovering at the end of the week. Last weeks U.S. jobs report

USD/JPY Weekly Fundamental Analysis – May 9 -14, 2016 -Forecast

The USD/JPY closed the week at 107.12 with a gain of 0.71% this week as the US dollar ended recovering at the end of the week. Last weeks U.S. jobs report was a bit of a mixed bag which will enable people to take away from it whatever suits their agenda. The headline Non-Farm Payrolls number will always hog the spotlight immediately following the release and the disappointment here, combined with slight downward revisions for February and March, sent the U.S. dollar lower initially. The dollar has since recovered to trade back at pre-release levels which suggests markets aren’t as disappointed as the initial move would indicate. Of course we can often see a lot of volatility in the immediate aftermath of the data and only once the dust has settled do we see what investors really think of the numbers.

The dollar lost upward momentum after the U.S. nonfarm payrolls (NFP) report showed a gain 160,000 jobs after a forecast of 205,000 jobs. The U.S. unemployment rate remained at 5 percent and in a positive note the hourly wages were in line with expectations at 0.3 percent on a monthly basis and a 2.5 percent gain since last year.

The Japanese Yen gave back some of its recent gains versus the US Dollar in a choppy week for financial markets. Yet momentum remains in the Yen’s favor—particularly given key US economic data disappointments. Japanese markets will be closed for most of the “Golden Week” holiday ahead, and this in itself suggests volatility may slow. Recent volatility in the US Dollar and broader FX markets suggest we may see notable JPY swings all the same.

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
Sunday, May 8, 2016
  CNY Trade Balance (USD) (Apr)   40.00B 29.86B  
Tuesday, May 10, 2016
  CNY CPI (YoY) (Apr)   2.4% 2.3%  
Wednesday, May 11, 2016
    GBP Manufacturing Production (MoM) (Mar)   0.3% -1.1%  
    USD Crude Oil Inventories     2.784M  
Thursday, May 12, 2016
  GBP Interest Rate Decision (May)   0.50% 0.50%  
Friday, May 13, 2016
    USD Core Retail Sales (MoM) (Apr)   0.5% 0.1%  
    USD PPI (MoM) (Apr)   0.3% -0.1%  
    USD Retail Sales (MoM) (Apr)   0.7% -0.4%  
Saturday, May 14, 2016
  CNY Industrial Production (YoY) (Apr)   6.5% 6.8%  

Upcoming Government Bond Auctions

Date Time Country 

May 09 17:20 Italy Announces details of bond auction

May 09 N/A Ireland Details of bond auction on May 12

May 10 11:30 Germany Holds I/L bond auction

May 11 11:03 Sweden Holds bond auction

May 11 11:30 Germany Eur 5bn Jun 2018 Schatz

May 12 11:10 Italy Holds bond auction

May 12 17:20 Sweden Details of I/L auction on May 19

May 12 N/A Ireland Holds bond auction

 

 

 

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