The carry trades dominate the Japanese yen trading, as investors sell low yielding currencies like the yen and buy high yielding currencies, the fact that prompted the yen to drop against the dollar and other major currencies.
The dollar extended its rally against the yen and reached a new 6-month high at 85.51. The Japanese yen is facing a strong selling storm that started 3 weeks ago, driving the yen down against all major currencies.
The USD/JPY is expected to show some weakness during next week, as a correctional movement after it gained for 3 consecutive weeks.
Before the day’s beginning, the Japanese economy will issue machine orders index for February, and expected to come at – 1.0% from 4.2%, as for the annual reading it had a previous of 5.9% and expected to show a rise of 9.0%. The machine order data could affect the USD/JPY movements, as it considers an indicator for the capital spending in Japan.
The day will witness almost no economical data from the U.S. economy, which will push the pair to move according to the Japanese data and the current market sentiment.
Originally posted here
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