USD/JPY Fundamental Forecast – September 14, 2016

The USD/JPY added 7 points to trade at 101.93 as the dollar gained but the yen remains too strong and continues to pressure the BoJ ahead of next week’s conference. It seems there is nothing the government or the central bank can do to change the economic situation. Better than expected Chinese data did not assist the currency. Japanese Large Manufacturing Conditions printed much better than last month but left the currency is dangerous territory.

The yen gained and a gauge of the US dollar held its first decline in four days after Federal Reserve governor Lael Brainard said the case for the central bank to raise interest rates is “less compelling”.

The yen added gains as the market-implied probability of a US rate hike this month dropped to 22 per cent from 30 per cent at the end of last week. The greenback weakened against most of its 16 major counterparts on Monday following Ms Brainard’s comments in Chicago, which were the last before the Fed enters its blackout period.

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 September 14, 2016

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