USD/JPY Fundamental Analysis February 27, 2012, Forecast

Economic Events: (GMT)

Feb 26 GMT

21:45     NZD                     Trade Balance  

The Trade Balance measures the difference in value between imported and exported goods and services over the reported period. A positive number indicates that more goods and services were exported than imported.

A higher than expected reading should be taken as positive/bullish for the NZD, while a lower than expected reading should be taken as negative/bearish for the NZD.                                              

23:50     JPY                       Retail Sales (YoY)                                                                                                           

Retail Sales measure the change in the total value of inflation-adjusted sales at the retail level. It is the foremost indicator of consumer spending, which accounts for the majority of overall economic activity. 

A higher than expected reading should be taken as positive/bullish for the JPY, while a lower than expected reading should be taken as negative/bearish for the JPY.

Analysis and Recommendation: (close of Asian session)

USD/JPY was trading at 80.38, the USD weakened as crude oil and gold prices continued to climb up but began to add strength during the Asian trading session. Positive economic data came from the US on Thursday, while Friday morning the CSPI in Japan reported below forecast.

Japan’s central-bank governor offered a reminder Thursday of the risks facing the nation’s banks from a concentration of Japanese government-bond holdings.

Japan’s banks have continued to pour money into government debt, despite near-record-low yields and the nation’s deteriorating fiscal conditions. But any sudden rise in interest rates could expose the banks to trillions of yen in losses, Bank of Japan Gov. Masaaki Shirakawa said in response to a lawmaker’s question at a parliamentary committee on the strong yen and deflation.

As the yen finally weakens against the dollar, Japan’s exporting manufacturers are sitting on potential operating-profit gains that could be worth billions of dollars 

US unemployment data today showed the week ending February 18, the advance figure for seasonally adjusted initial claims was 351,000, unchanged from the previous week’s revised figure of 351,000. The 4-week moving average was 359,000, a decrease of 7,000 from the previous week’s revised average of 366,000.

February 23, 2012 (GMT) economic results actual v. forecast

 

Sovereign Bond Auction Schedule

Feb 27-Mar 02 n/a  UK  Mini Tender

Feb 27  10:10  Italy   BOT auction

Feb 27  10:30  Germany  Eur 3.0bn Feb 2013 Bubill

Feb 27  11:00  Belgium  OLO Auction

Feb 27  12:00  Norway  Details bond auction on May 05

Feb 28  01:30  Japan  Auctions 2Y JGBs

Feb 28  10:10  Italy   BTP/CCTeu auction

Feb 28  10:30  Belgium  Auctions 3 & 6M T-bills

Feb 28  15:30  UK  Details gilt auctions on Mar 06 & Mar 07

Feb 29  10:10  Sweden  Auctions T-bills

Feb 29  10:30  Germany  Eur 4.0bn 2.0% Jan 2022 Bund

Feb 29  15:30  Sweden  Details nominal bond auction on Mar 07

Mar 01  09:30  Spain  Bono auction

Mar 01  09:50  France  OAT auction

Mar 01  10.30  UK  Auctions 4.0% 2022 conventional Gilt