EUR/JPY Fundamental Analysis – November 6, 2015 – Forecast

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Updated: Nov 5, 2015, 04:49 UTC

Analysis and Recommendations: The EUR/JPY dipped 3 points to 132.05 as the euro and the yen weakened. The euro weakened after comments from ECB Governor

EUR/JPY Fundamental Analysis – November 6, 2015 - Forecast

Analysis and Recommendations:

The EUR/JPY dipped 3 points to 132.05 as the euro and the yen weakened. The euro weakened after comments from ECB Governor Draghi supported additional stimulus in December. The two banks could add stimulus at the same time.

The Bank of Japan has once again pushed back the forecast for achieving its target of a 2 percent annual inflation to pull the economy out of deflation. When BOJ Gov. Haruhiko Kuroda launched the “unprecedented” monetary easing operation — a centerpiece of Prime Minister Shinzo Abe’s trademark “Abenomics” policies — in April 2013, he said he was confident the inflation goal would be attained in about two years. That forecast was pushed back last April to “around the first half of fiscal 2016″ and postponed last week to “around the latter half of fiscal 2016.”

Kuroda did so as the BOJ lowered its estimate for real-term growth in Japan’s gross domestic product and consumer price increases in fiscal 2015 and 2016, reflecting the impact of China’s slowdown on Japanese output and exports along with the slow recovery in consumer spending.

The BOJ governor attributed the postponement to the fall in crude oil prices that has continued longer than anticipated and insisted that the underlying price trend was steadily improving — a claim backed by a 1.2 percent increase in consumer prices, excluding energy costs, in September.

Wednesday’s initial public offering was part of a complex stock market debut that saw the Japanese government spin off and also sell the postal operator’s insurance and banking subsidiaries. Investor demand was high, with the insurance arm jumping more than 56%, while the banking division gained 15%.

The benchmark Nikkei in Tokyo rose around 1.3%. The triple IPO is Japan’s biggest sale of state assets in decades, and is part of a wider government push to privatize state-owned companies and get money pulsing through the sluggish economy. Japan had been trying to privatize its postal operations — known for its iconic red delivery vans and motorcycles — for roughly a decade, but extreme public resistance to the move had prevented the government from going ahead. Some experts voiced concern ahead of the IPO about Japan Post’s ability to sustain future growth.

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:

Cur.	Event	Actual	Forecast	Previous
AUD	RBA Governor Stevens Speaks
JPY	Monetary Policy Meeting Minutes
USD	FOMC Member Stanley Fischer
AUD	RBA Assist Gov Lowe Speaks

Upcoming Economic Events that you should be monitoring:

Friday, November 6, 2015

Cur.	Event	Actual	Forecast	Previous
AUD	Monetary Policy Meeting Minutes
JPY	BoJ Governor Kuroda Speaks
EUR	German Industrial Production (MoM)		0.5%	-1.2%
GBP	Halifax House Price Index (MoM)		-0.7%	-0.9%
GBP	Industrial Production (MoM) (Sep)		-0.1%	1.0%
GBP	Manufacturing Production (MoM)		0.4%	0.5%
GBP	Trade Balance (Sep)		-10.60B	-11.15B
USD	FOMC Member Bullard Speaks
USD	Average Hourly Earnings (MoM) (Oct)		0.2%	0.0%
USD	Nonfarm Payrolls (Oct)		180K	142K
USD	Private Nonfarm Payrolls (Oct)		165K	118K
USD	Unemployment Rate (Oct)		5.1%	5.1%
GBP	NIESR GDP Estimate		0.6%	0.5%
USD	Baker Hughes U.S. Rig Count			578