USD/JPY Fundamental Forecast – September 13, 2016

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Published: Sep 12, 2016, 04:40 GMT+00:00

The USD/JPY dipped 20 points as the markets opened on Monday to trade at 102.52 after the release of mixed economics data. The producers price index

USD/JPY Fundamental Forecast – September 13, 2016

The USD/JPY dipped 20 points as the markets opened on Monday to trade at 102.52 after the release of mixed economics data. The producers price index missed expectations while machinery orders printed much higher than expected. The currency market also kept an eye on the sell-off in global bonds, with perceived limits to central bank policies having taken German and Japanese sovereign bond yields to multi-month highs. U.S. Treasury yields have also tracked their global peers higher.

The Bank of Japan is reviewing options to steepen the bond yield curve, say sources familiar with its thinking, as authorities desperately seek out policy tools to revive an economy that has failed to emerge from stagnation despite years of massive stimulus. While the stock market’s fall was the main driver behind the yen’s firmer showing, the Japanese currency also benefited from its safe haven status in reaction to Democratic candidate Hillary Clinton falling ill at a Sept. 11 memorial ceremony and diagnosed with pneumonia. Markets have generally assumed Clinton would win the presidency and have not truly considered the implications, both economic and for national security, should Donald Trump prevail.

The International News reported that some analysts said reports of a North Korean nuclear test could be lending support to the yen, a low-yielding funding currency that can rise on short-covering in times of market stress, others played down the impact. North Korea announced on Friday it had conducted its fifth nuclear test, hours after seismic monitors detected a blast near the secretive country’s nuclear test site.

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September 13, 2016

CNY	FDI – Foreign Direct Investment (YTD) Y	2	4.3
AUD	RBA Assistant Governor Kent Speech	2
CNY	Retail Sales Y	2	10.2	10.3
CNY	Industrial Production Y	2	6	6.1
EUR	Wholesale Price Index M	2	0.2
EUR	Wholesale Price Index Y	2	-1.4
EUR	Consumer Price Index Y	2	0.4	0.4
EUR	Index of Consumer Prices M	2	-0.1	-0.1
EUR	Index of Consumer Prices Y	2	0.3	0.3
EUR	Consumer Price Index M	2	0.1	0
GBP	Producer Price Index – Input M	2	3.3	0.5
GBP	Producer Price Index – Input Y	2	4.3	8.1
GBP	PPI Core Output Y	2	1	1.3
GBP	Producer Price Index – Output M	2	0.3	0.3
GBP	Producer Price Index – Output Y	2	0.3	1.1
GBP	PPI Core Output M	2	0.4	0.2
GBP	Consumer Price Index M	2	-0.1	0.4
GBP	Consumer Price Index Y	3	0.6	0.7
GBP	Core Consumer Price Index Y	3	1.3	1.4
EUR	ECB President Draghi’s Speech	3
EUR	ZEW Survey – Economic Sentiment	3	4.6	6.7
EUR	ZEW Survey – Current Situation	2	57.6	56
EUR	ZEW Survey – Economic Sentiment	2	0.5	2.5
USD	10-Year Note Auction	2	1.503
USD	Monthly Budget Statement	2	-113

Government Bond Auctions

Date Time Country Auction

Sep 13 11:00 Netherlands Eur 2-3bn 0% Jan 2022 DSL

Sep 13 11:10 Italy Holds bond auction

Sep 14 11:05 Norway Holds bond auction

Sep 14 11:30 UK 0.125% 2046 I/L Gilt

Sep 14 11:30 Germany Eur 1bn 2.5% Jul 2044 Bund

Sep 15 10:30 Spain Holds bond auction

Sep 15 11:03 Sweden Holds I/L bond auction

Sep 15 11:50 France Holds bond auction

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