By FXEmpire.com

Introduction: This is one of the most popular crosses. The primary reason why EUR/JPY has rallied 11 percent over the past 3.5 months is because of US growth – not many people realize that the price action of EUR/JPY is directly correlated with how the US economy is doing.

Weekly Analysis and Recommendations:

The EUR/JPY closed the week down at 96.17 as the euro started off strongly as last weekend investors digested all the central bank action and by Monday morning were very supportive of Mr. Draghi and in positive moods, but as the week progressed and little headway was made by the ECB or within the EU. As Greece, Spain and Italy dragged on investors cherry moods turned negative. The euro dipped below the 1.23 price.

In Japan the BoJ held rates and policy as expected but was once again hit with negative eco data. (see chart below ) which is weighing on the currency.

Date

Last

Open

High

Low

Change %

Aug 10, 2012

96.17

96.61

96.70

95.72

-0.46%

Aug 09, 2012

96.61

97.02

97.29

96.33

-0.42%

Aug 08, 2012

97.02

97.36

97.42

96.58

-0.35%

Aug 07, 2012

97.36

96.89

97.82

96.84

0.48%

Aug 06, 2012

96.89

97.70

97.70

96.70

-0.83%

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 recent analysis and information in our weekly reports and we provide daily updates and outlooks

Major Economic Events for the week of Aug 6-10 actual v. forecast for Yen, the Aussie, the Kiwi and USD

Date

Currency

Event

Actual

Forecast

Previous

Aug 6

AUD

ANZ Job Advertisements m/m

-0.8%

-1.1%

NZD

Labor Cost Index q/q

0.5%

0.6%

0.5%

Aug 7

AUD

Cash Rate

3.50%

3.50%

3.50%

JPY

Current Account

0.77T

0.75T

0.28T

Aug 8

AUD

Home Loans m/m

1.3%

2.1%

-0.9%

USD

Prelim Nonfarm Productivity q/q

1.6%

1.5%

-0.9%

USD

Prelim Unit Labor Costs q/q

1.7%

0.5%

1.3%

USD

Crude Oil Inventories

-3.7M

-0.6M

-6.5M

USD

10-y Bond Auction

1.68|2.5

1.46|3.6

NZD

Employment Change q/q

-0.1%

0.3%

0.4%

NZD

Unemployment Rate

6.8%

6.5%

6.7%

JPY

Core Machinery Orders m/m

5.6%

11.1%

-14.8%

Aug 9

AUD

Employment Change

14.0K

10.2K

-28.3K

AUD

Unemployment Rate

5.2%

5.3%

5.3%

JPY

Overnight Call Rate

<0.10%

<0.10%

<0.10%

NZD

REINZ HPI m/m

-0.7%

0.3%

USD

Trade Balance

-42.9B

-47.4B

-48.0B

USD

Unemployment Claims

361K

371K

367K

USD

Mortgage Delinquencies

7.58%

7.40%

USD

Import Prices m/m

-0.6%

0.1%

-2.4%

USD

Federal Budget Balance

-69.6B

-103.0B

-59.7B

Historical: From 2010 to Present

Highest: 134.38 JPY on Jan 11, 2010

Average: 111.13 JPY over this period.

Lowest: 94.12 JPY on July 24, 2012

Economic Highlights of the coming week that affect the AUD, JPY, NZD and USD

Date

Time

Currency

Event

Previous

Aug 13

13th-14th

NZD

REINZ HPI m/m

0.3%

22:45

NZD

Core Retail Sales q/q

-2.5%

23:50

JPY

Monetary Policy Meeting Minutes

23:50

JPY

Tertiary Industry Activity m/m

0.7%

Aug 14

1:30

AUD

NAB Business Confidence

-3

1:30

AUD

New Motor Vehicle Sales m/m

-0.6%

12:30

USD

Core Retail Sales m/m

-0.4%

12:30

USD

PPI m/m

0.1%

12:30

USD

Retail Sales m/m

-0.5%

14:00

USD

Business Inventories m/m

0.3%

Aug 15

0:30

AUD

Westpac Consumer Sentiment

3.7%

1:30

AUD

Wage Price Index q/q

0.9%

12:30

USD

Core CPI m/m

0.2%

12:30

USD

Empire State Manufacturing Index

7.4

13:00

USD

TIC Long-Term Purchases

55.0B

13:15

USD

Capacity Utilization Rate

78.9%

13:15

USD

Industrial Production m/m

0.4%

14:30

USD

Crude Oil Inventories

Aug 16

1:00

AUD

MI Inflation Expectations

3.3%

12:30

USD

Building Permits

0.76M

12:30

USD

Housing Starts

0.76M

14:00

USD

Philly Fed Manufacturing Index

-12.9

22:45

NZD

PPI Input q/q

0.3%

Aug 17

13:55

USD

Prelim UoM Consumer Sentiment

72.3

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