By FX Empire.com

The USD/JPY dropped for the second consecutive week since the BOJ intervened in the FX market, where risk aversion returned in the financial market to increase demand for safe have currencies such as the yen and greenback.

Bank of Japan did not introduce any new support to the Japanese economy during the last meeting, while the Japanese authorities lowered the economic assessment, increasing fears among investors which returned to prefer investment in the Japanese currency.

The greenback also witnessed a strong performance against most of its major counterparts excluding the yen, where the federal currency reached its highest level in five weeks against the euro and the highest in four weeks against the British pound.

The EU debt crisis still dominates investors’ sentiment and reflected negatively on other economies performance, fueling the pessimistic outlook for the global economy, pushing readers to abandon riskier assets.

Adding to the gloomy picture, the credit agency Fitch warned the United States banking sector of a possible infection from the EU crisis, which could lead to downgrade some banks in U.S.

On the other hand, the expected movement for the USD/JPY pair is to continue moving to downside adding more pressure on the BOJ to intervene once again in the FX market.

Major highlights for this week that will affect the USD/JPY pair’s trading:

Monday November 21:

On Monday at 23:50 GMT (Sunday), Japan will issue Merchandise Trade Balance for October, where it’s expected to show surplus of 28.8 billion yen compare to the previous surplus of 300.4 billion yen.

The Adjusted Merchandise Trade Balance for October is expected to show a deficit of 82.0 billion yen widening from 21.8 billion yen deficit.

At 04:30 GMT, the Japanese economy will release the All Industry Activity Index for September, where it’s expected to fall by 1.0% from the previous reading of -0.5%.

Coincident Index for September will be released at 05:00 GMT, where it had a prior reading of 88.9, while the Leading Index for the same month had a previous reading of 91.6.

At 15:00 GMT, the U.S. economy will release the Existing Home Sales for October, where it’s expected to come at 4.80 million down by 2.2% from the previous reading of 4.91 million which is down by 3.0%.

Tuesday November 22:

On Tuesday at 13:30 GMT, the U.S. economy will release the annualized Gross Domestic Product for the third quarter, where it’s expected unrevised at 2.5%.

The Personal Consumption for the third quarter is also expected unrevised at 2.4% as well as the Core Personal Consumption Expenditure to hold at 2.1%.

At 19:00 GMT, the Federal Reserve Bank will release its minutes for the Nov. 1-2 FOMC meeting.

Wednesday November 23:

On Wednesday at 13:30 GMT, the U.S. economy will release the Durable Goods Orders for October, which is expected to come at -1.0% from the previous -0.8%.

Also the Personal Income for October will be released at the same time and expected to improve to 0.3% from 0.1% while the U.S. Personal Spending is expected to slow to 0.3% from 0.6%.

The annual Personal Consumption Expenditure Core for October is expected to come at 1.7% compare to the previous reading of 1.6%.

At 13:30 GMT, the U.S. economy will issue its weekly initial claims, where the number of people filing for first-time claims for the state unemployment insurance fell to 388 thousand last week.

Finally, the U.S. economy will release the University of Michigan Confidence for November at 14:55 GMT, where the final reading is expected to come at 64.5 from the prior reading of 64.2.

Thursday November 24:

Both economies will not release any data on Thursday, while U.S. markets will be closed for Thanksgiving Holiday.

Friday November 25:

On Friday at 23:30 GMT (Thursday), Japan will release the annual National Consumer Price Index for October, where it’s expected to come at -0.2% from the previous reading of 0.0%.

The National Consumer Price Index Ex-Fresh Food is expected to show a drop of 0.1%.

Originally posted here