Analysis and Recommendation:

The USD/JPY regained its momentum today, pushing the USD back below the 78.50 range to trade at 78.27. The Bank of Japan rate and policy meeting concludes tomorrow, but no changes are expected.

There was little news to drive trade and that instead buyers were balancing out their dollar weightings with other currencies. This is hardly the start of a risk-on move; instead, it appears to be diversification away from the world’s reserve currency, with the Japanese yen leading the majors thus far. With the possibility of the FOMC providing stimulus the USD is expected to remain weak throughout the month.

There is little on the eco calendar for the US and Europe today and little is expected in news flow that would have major currency affects. Spain is expected to finally request an official bailout and news on Greece is expected.

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 up to the data analysis and information in our weekly reports.

Economic Data August 7, 2012 actual v. forecast

Date

Currency

Event

Actual

Forecast

Previous

Aug. 07

GBP

BRC Retail Sales Monitor (YoY)

0.1%

-0.2%

1.4%

AUD

AIG Construction Index

32.6

34.8

Upcoming Economic Events that affect the AUD, NZD, JPY and USD

Date

Time

Currency

Event

Previous

Aug 8

1:30

AUD

Home Loans m/m

-1.2%

12:30

USD

Prelim Nonfarm Productivity q/q

-0.9%

12:30

USD

Prelim Unit Labor Costs q/q

1.3%

14:30

USD

Crude Oil Inventories

22:45

NZD

Employment Change q/q

0.4%

22:45

NZD

Unemployment Rate

6.7%

23:50

JPY

Core Machinery Orders m/m

-14.8%

Aug 9

1:30

AUD

Employment Change

-27.0K

1:30

AUD

Unemployment Rate

5.2%

12:30

USD

Trade Balance

-48.7B

12:30

USD

Unemployment Claims

Aug 10

1:30

AUD

RBA Monetary Policy Statement

12:30

USD

Import Prices m/m

-2.7%

18:00

USD

Federal Budget Balance

-59.7B

Government Bond Auctions

Date Time Country

Aug 08 09:30 Germany

Aug 08 10:00 Norway

Aug 08 15:30 Italy

Aug 08 17:00 US

Aug 09 15:30 Italy

Aug 09 17:00 US

Aug 10 10:00 Belgium

Aug 13 09:10 Italy

Aug 13 09:10 Norway

Aug 13 09:30 Germany

Click here to read USD/JPY Technical Analysis.

Originally posted here