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FxPro Forex Analysis: Japanese Yen Continues to Extend Gains


After yesterday’s surprise move by the Bank of Japan to reduce bond purchases, the Yen has continued its move against other currencies. GBPJPY, for example, is down -0.65%, trading at 151.556, adding to yesterday’s move. Stops are being triggered in an unwind of the recent trend. Even the Japanese stock market is under pressure, with the Japan 225 down -0.36%, trading around 23777.00 for a second consecutive down day.

Chinese Consumer Price Index (YoY) (Dec) came in at 1.8% v 1.9% expected with a prior of 1.7%. Producer Price Index (YoY) (Dec) was 4.9% v 4.8% expected with the previous number of 5.8%. Consumer Price Index (MoM) (Dec) came in at 0.3% v 0.4% expected from a previous of 0.0%.

German Trade Balance s.a. (Nov) came out at 22.3B v an expected 20.9B, from a previous 19.9B. Exports (MoM) (Nov) were 4.1% v an expected 1.2%, from -0.4% previously that was revised up to -0.3%. Imports (MoM) (Nov) were 2.3% v 0.8% expected, from 1.8% prior. Current Account n.s.a. (Nov) was 25.4B v 25.5B consensus, from a previous of 18.1B. EURUSD moved higher after the data to test 1.19707 but sellers took price lower subsequently.

Swiss Real Retail Sales (YoY) (Nov) came in at -0.2% compared to a consensus of -2.5% and the previous number was -3.0%, but this was revised up to -2.6%. USDCHF moved higher when the data was published to test resistance at 0.88335.

Eurozone Unemployment Rate (Nov) was as expected at 8.7% v a prior of 8.8%. EURGBP sold off from 0.88254 to 0.88084 following the data release.

Canadian Housing Starts s.a (YoY) (Dec) was in at 217K v an expected 212.5K, from a prior of 252.2K which was revised to 251.7K. USDCAD sold off from 1.24438 to 1.24243 in reaction to this.

EURUSD is down -0.09% overnight, trading around 1.19253.

USDJPY is down -0.43% in the early session trading at around 112.157.

EURJPY is down -0.51% this morning, trading around 133.754.

GBPUSD is down -0.20% to trade around 1.35138.

USDCAD is up 0.08%, trading around 1.24731.

Gold is down -0.23% in early morning trading at around $1,309.37.

WTI is down -0.09%, trading around $63.35.

Major data releases for today:

At 09:30 GMT, UK Industrial Production (MoM) (Nov) will be released with an expected reading of 0.3% from a prior of 0.0%. Industrial Production (YoY) (Nov) consensus reading is 1.8%, with a prior of 3.6%. Manufacturing Production (MoM) (Nov) is expected to be 0.3%, with a previous reading of 0.1%. Manufacturing Production (YoY) (Nov) is expected at 2.8% from a prior of 3.9%. Traders of GBP pairs will be watching these data points closely.

Tentative – German 10-year Bond Auction. The previous auction’s Interest Rate was 0.3%. EUR pairs may react to this data.

At 13:00 GMT, UK NIESR GDP Estimate (3M) (Dec) data will be released. The previous data came in at 0.5%. This data attempts to predict the Government’s released data.

Tentative – US 10-Year Note Auction. The previous auction’s interest rate was 2.384%. USD crosses could react to this data.

At 18:30 GMT, US FOMC Member Bullard will be speaking. This may affect USD crosses, stocks, commodities and bonds.

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