USD/JPY Fundamental Analysis – November 19, 2015 – Forecast

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Published: Nov 18, 2015, 04:12 GMT+00:00

Analysis and Recommendation: The USD/JPY dipped 8 points to 123.37 after hitting its highest level in months as the US dollar continues to rally as the

USD/JPY Fundamental Analysis – November 19, 2015 – Forecast

Analysis and Recommendation:

The USD/JPY dipped 8 points to 123.37 after hitting its highest level in months as the US dollar continues to rally as the days pass to the Fed December meeting. The ongoing speaking circuit of FOMC members all seems to echoing the same words – rate increase in December. It seems to unanimous.

The Federal Reserve will have a green light to lift interest rates for the first time in nearly a decade when it meets in December. The rhetoric coming out of the Fed has been rather hawkish, notably from Vice Chairman Stanley Fischer and Federal Reserve Bank of New York President William Dudley.

Japan’s current account surplus was reported to have increased four-fold in the period between April and September compared to the previous year. The ¥8.69 trillion surplus quadrupling has been on the back of a weak Yen and the continuing slide in crude oil prices. Lower energy prices have been very significant for Japan, as the nation has been dependent on energy imports since the earthquake and tsunami struck in 2011. In value terms, the Finance Ministry reported that the imports of crude oil fell by 34%.

Japan has slipped back into recession, shrinking -0.8 per cent for the July-September quarter, following the -0.7 per cent contraction of the previous quarter.

Consumer spending actually recorded some weak growth, of 0.5 per cent. However, capital investment declined by 1.3 per cent, dragging down the economy overall. Business remains concerned over the relative economic slowdown in China, Japan’s largest trading partner, and over the weak prospects for the economy in general.

This is the second recession under Abe’s Liberal Democratic Party government, following that of last year, in the wake of the consumption tax rate being raised from 5 to 8 per cent.

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
USD	FOMC Member Tarullo Speaks
USD	API Weekly Crude Oil	-0.482M	1.800M	6.300M
AUD	RBA Assist Gov Debelle Speaks
AUD	Wage Price Index (QoQ) (Q3)	0.6%	0.6%	0.6%
USD	FOMC Member Lockhart Speaks

Upcoming Economic Events that you should be monitoring:

Thursday, November 19, 2015

Cur.	Event	Actual	Forecast	Previous
NZD	PPI Input (QoQ) (Q3)			-0.3%
JPY	Adjusted Trade Balance		-0.38T	-0.36T
JPY	Exports (YoY) (Oct)		-2.1%	0.6%
JPY	Trade Balance (Oct)		-292B	-115B
JPY	BoJ Press Conference
EUR	German Buba President Weidmann
GBP	Core Retail Sales (MoM) (Oct)		-0.5%	1.7%
GBP	Core Retail Sales (YoY) (Oct)		3.9%	5.9%
GBP	Retail Sales (MoM) (Oct)		-0.5%	1.9%
GBP	Retail Sales (YoY) (Oct)		4.2%	6.5%
GBP	CBI Industrial Trends Orders (Nov)		-10	-18
EUR	Monetary Policy Meeting
USD	Initial Jobless Claims		271K	276K
USD	Philadelphia Fed Manufacturing Index		-1.0	-4.5
USD	Philly Fed Employment (Nov)			-1.7
USD	FOMC Member Lockhart Speaks