USD/JPY Fundamental Analysis – August 4, 2015 – Forecast

By:

Published: Aug 3, 2015, 03:55 UTC

Analysis and Recommendation: The USD/JPY added 17 points as the greenback is trading in the green the pair broke over the 124 price level. Chinese

USD/JPY Fundamental Analysis – August 4, 2015 – Forecast

Analysis and Recommendation:

The USD/JPY added 17 points as the greenback is trading in the green the pair broke over the 124 price level. Chinese manufacturing data missed again this morning putting pressure on all Asian currencies. A key China economic indicator took a sharp turn for the worse, with the final reading for the Caixin China purchasing managers’ index (PMI) for July surprising with a drop to a two-year low.

“The downturn in China’s manufacturing sector intensified at the start of the third quarter. Renewed falls in both total new work and new export orders led manufacturers to cut production at the fastest rate since November 2011,” the news release said.

Concerns about slowing economic growth on the mainland have spurred policy makers to action. Late last month the People’s Bank of China cut interest rates and the reserve requirement ratio (RRR) for some lenders in a bigger-than-expected easing package.

The Bank of Japan’s efforts to reach its 2 percent inflation target didn’t get much of a boost from the latest data, with the country’s core consumer price index for June barely budged and as households unexpectedly snapped their wallets shut.

A Japan government official laid the blame on bad weather for the month, adding that June’s decline doesn’t necessarily mean there’s a change in the moderate uptrend in household spending, according to a Reuters report.

Most of Japan experiences a rainy season in June, but while that’s an annual occurrence, some reports said there were more rainy days than usual this year. Lower than usual temperatures may also have hurt clothing sales.

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 up to the data analysis and information in our weekly reports.

Today’s economic releases:

Cur.	Event	Actual	Forecast	Previous
	Canada – Civic Holiday
CNY	Caixin Manufacturing PMI (Jul)	47.8	48.3	48.2

Upcoming Economic Events that you should be monitoring:

Tuesday, August 4, 2015

Cur.	Event	Actual	Forecast	Previous
AUD	Retail Sales (MoM) (Jun)		0.5%	0.3%
AUD	Interest Rate Decision (Aug)		2.00%	2.00%
GBP	Construction PMI (Jul)		58.4	58.1