Forex Pros – Last week saw the U.S. dollar climb to a five-week high against the yen, as rising U.S. Treasury yields and encouraging U.S. economic data boosted the outlook for U.S. growth.
USD/JPY hit 83.66 on Friday, the pair’s highest since January 7; the pair subsequently consolidated at 83.41 by close of trade, surging 1.49% over the week.
The pair is likely to find support at 82.32, Thursday’s low and resistance at 83.66, Friday’s high and a five-week high.
On Thursday, U.S. government data showed that initial claims for jobless benefits fell last week to the lowest level since July 2008. They dropped by 36,000, more than forecast, to 383,000, Labor Department figures showed.
Meanwhile, the Thomson Reuters/University of Michigan preliminary index of consumer sentiment rose to 75.1, the highest level since June, from 74.2 in January.
Elsewhere, Japan’s economy minister, Kaoru Yosano, on Thursday reiterated that Japan should make a strong commitment on fiscal reform to win the confidence of financial markets after Moody’s Investors Service warned that the country’s credit rating might be in for a downgrade.
In January, ratings agency, Standard and Poor’s cut Japan’s credit rating by one notch, citing concerns over its ballooning public debt.
In the week ahead, the U.S. is to publish official data in inflation and retail sales while the Federal Reserve is to publish the minutes of its most recent monetary policy meeting. The U.S. is also to publish its weekly report on initial jobless claims.
Meanwhile, Japan is to publish preliminary data on gross domestic product while the Bank of Japan is to announce its benchmark interest rate.
Ahead of the coming week, Forex Pros has compiled a list of these and other significant events likely to affect the markets.
Monday, February 14
Japan is to publish preliminary data on GDP, the broadest measure of economic activity and the primary gauge of the economy’s health.
Tuesday, February 15
The Bank of Japan is to announce its benchmark interest rate. The announcement is to be followed by a press conference to discuss the rate decision. Later in the day, Japan is to publish a report on tertiary industry activity, a leading indicator of economic strength.
The U.S. is to publish government data on retail sales, the primary gauge of consumer spending, which accounts for the majority of overall economic activity. The nation is also to publish a report on manufacturing activity in the state of New York as well as data on foreign investments in the U.S. and a report on import prices.
Wednesday, February 16
The U.S. is to publish official data on producer price inflation, a leading indicator of consumer inflation. The nation is also to publish government data on building permits, an excellent gauge of future construction activity, as well as reports on housing starts and industrial production.
Later in the day, the Federal Reserve is to publish the minutes of its most recent monetary policy committee meeting, providing in-depth insights into the economic and financial conditions that influenced the vote on where to set interest rates.
Elsewhere, the BOJ is to publish its monthly report, which contains the statistical data that policymakers looked at when setting the interest rate.
Thursday, February 17
The U.S. is to publish its weekly report in initial jobless claims, a leading indicator of economic health. The nation is also to publish official data on consumer price inflation, which accounts for a majority of overall inflation and a report on manufacturing activity in the state of Philadelphia.
Meanwhile, Federal Reserve Chairman, Ben Bernanke, is to testify before Congress; his comments will be closely watched as they are often used to drop subtle clues regarding future monetary policy.
In addition, the BOJ is to publish the minutes of its most recent monetary policy meeting. The data provides in-depth insights into the economic conditions that influenced the committee’s decision on where to set interest rates.
Friday, February 18
Federal Reserve Chairman Ben Bernanke is to deliver a speech at a public engagement; his remarks will be closely scrutinized for any hints to the possible future direction of monetary policy.
ForexPros.com
