EUR/JPY Fundamental Analysis – August 26, 2015 – Forecast

Analysis and Recommendations:

The EUR/JPY added 66 points to trade at 138.25 as safe haven trades subsided. Markets remain in risk off mode as traders corrected and adjusted yesterday’s action.  The Chinese stock markets had their worst day in eight years with the benchmark Shanghai Composite Index tumbling 8.49 percent to close at 3,209.91 points.

European equities also dived on Monday following the steep decline in the previous session, as the Stoxx Europe 600 was down over 6 percent and Germany’s DAX dropped 4 percent.

Increasingly wary traders in the global financial markets are seeking a safe haven in the yen, making the Japanese currency gain strength against the greenback.

The Japanese currency gained strength. Monday as trading rooms in financial institutions were abuzz with veteran dealers grumbling about the unexpected rise. The dollar had traded at around 124 yen just last week, only to weaken by more than 8 yen. It depreciated by 5.97 over the past day alone, the most since Wall Street took a hit in May 2010. The volatility is even reaching levels seen during the 2008 global financial crisis.

The yen had been steadily depreciating since Shinzo Abe began his second run as prime minister in 2012. But in the face of reversing trends, hedge funds and other investors are scrambling to buy up the same Japanese currency they had been aggressively selling in the past.

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.

Today’s economic releases:

 

Upcoming Economic Events that you should be monitoring:

Wednesday, August 26, 2015

Government Bond Auctions

Date Time Country

Aug 25 00:00 UK Announces details of Jan 2021 gilt

Aug 25 17:30 Italy Announces details of BTP/CCTeu on 28 Aug

Aug 25 19:00 US Holds 2-year note auction

Aug 26 11:10 Italy Eur 3bn 0.15% Aug 2017 CTZ

Aug 26 19:00 US Holds 2-year FRN note auction

Aug 26 12:05 Norway Holds bond auction

Aug 26 19:00 US Holds 5-year note auction

Aug 26 19:00 US Holds 2-year FRN auction

Aug 27 11:03 Sweden Sek 0.5bn 0.125% I/L Jun 2019, Sek 0.5bn 1% Jun 2025 bonds

Aug 27 19:00 US Holds 7-year note auction

Aug 28 11:10 Italy Auctions BTPs/CCTeus

Sep 01 11:15 Austria Holds RAGB bond sale

Sep 01 00:00 UK Announces details of 3.5% 2045 Gilt

Sep 02 11:03 Sweden Holds bond auction

Sep 02 11:30 Germany Eur 4bn 0.25% Oct 2020 Bobl

Sep 02 11:30 UK Auctions new Jan 2021 Gilt

Sep 03 10:30 Spain Auctions Bonos/Obligaciones

Sep 03 11:10 France Auctions OATs

Sep 03 00:00 US Announces details of 3yr note on 08 Sep, 10yr note on 09 Sep

Sep 03 00:00 US Announces details of 10-year note on 09 Sep