USD/JPY – Japanese yen subdued, GDP next

It continues to be a quiet week for USD/JPY. In Thursday’s North American session, the pair is trading at 111.57, down 0.17% on the day. On the release front, U.S. employment claims dipped to 223 thousand, below the estimate of 225 thousand. Investors will be keeping an eye on Japanese numbers. Household spending is expected to decline by 0.1% and GDP is forecast to expand by 0.4%. On Friday, the focus will be on employment numbers, as the U.S. releases wage growth and nonfarm payrolls.

After four rate hikes from the Federal Reserve in 2018, the central bank has starkly changed directions, with no rate hikes so far in 2019. The Federal Reserve has been in dovish mode since December, and this stance was reinforced by Jerome Powell in testimony before Congress. On Tuesday, Boston Fed President Eric Rosengren, who is a considered a hawk on monetary policy, said that there was some downside risk to the U.S. economy and called on policymakers to be “patient” for several more meetings in order to evaluate the risks to the economy. Without being explicit, Rosengren appears to support the Fed remaining on the sideline for the upcoming policy meetings until the Fed can better gauge the health of the U.S. economy.

Is a breakthrough imminent in the bitter U.S-China trade row? The conflict has weighed on the global economy and caused significant volatility in the equity markets, with nervous investors snapping the safe-haven yen. Now that trade tensions have eased between the two super-economies, investor risk appetite has improved. If progress continues and the sides ink an agreement, the yen will be less attractive as investors feel more comfortable with riskier assets.

Attention on deficit disorder sinks stocks

ECB lifts stocks off lows and sinks euro

U.S dollar looking for direction

USD/JPY Fundamentals

Thursday (March 7)

  • 00:00 Japanese Leading Indicators. Estimate 96.2%. Actual 95.9%
  • 7:30 US Challenger Job Cuts. Estimate 117.2%
  • 8:30 US Revised Nonfarm Productivity. Estimate 1.5%. Actual 1.9%
  • 8:30 US Revised Unit Labor Costs. Estimate 1.7%. Actual 2.0%
  • 8:30 US Unemployment Claims. Estimate 225K. Actual 223K
  • 10:30 US Natural Gas Storage. Estimate -141B. Actual -149B
  • 12:15 US FOMC Member Brainard Speaks
  • 15:00 US Consumer Credit. Estimate 16.4B
  • 18:30 Japanese Household Spending. Estimate -0.5%
  • 18:50 Japanese Bank Lending. Estimate 2.4%
  • 18:50 Japanese Current Account. Estimate 1.39T
  • 18:50 Japanese Final GDP Price Index. Estimate -0.3%
  • 18:50 Japanese Final GDP. Estimate 0.4%
  • 19:00 Japanese Average Cash Earnings. Estimate 1.2%

Friday (March 8)

  • 8:30 US Average Hourly Earnings. Estimate 0.3%
  • 8:30 US Nonfarm Employment Change. Estimate 181K
  • 8:30 US Unemployment Rate. Estimate 3.9%
  • 8:30 US Building Permits. Estimate 1.29M
  • 22:00 US Federal Chair Powell Speaks

 

 

*All release times are EST

*Key events are in bold

USD/JPY for Thursday, March 7, 2019

USD/JPY March 7 at 10:50 EST

Open: 111.77 High: 111.86 Low: 111.56 Close: 111.57

USD/JPY Technical

S3 S2 S1 R1 R2 R3
109.37 110.28 110.90 112.16 112.93 113.70

In the Asian session, USD/JPY ticked lower but recovered. The pair showed limited movement in European trade and has recorded slight losses in North American trade

  • 110.90 is providing support
  • 112.16 is the next resistance line
  • Current range: 110.90 to 112.16

Further levels in both directions:

  • Below: 110.90, 110.28, 109.37 and 108.11
  • Above: 112.16, 112.93 and 113.70

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.