Which catalysts can affect the yen crosses this week? Here’s a short list!
Lower-tier data releases
If you’ve read last week’s price recap, then you’ll know that traders paid some attention to the Bank of Japan’s (BOJ) more dovish bias so that the yen’s gains were capped against its major counterparts.
Tomorrow at 12:50 am GMT we’ll learn more about the BOJ’s decision as they print its meeting minutes. The BOJ’s core CPI scheduled at 6:00 am GMT should also provide clues on how aggressive Governor Kuroda and his gang should be in the foreseeable future.
Lower-tier reports could also wring out a pip or two during their releases. Retail sales data on June 27 at 12:50 am GMT is expected to print a 0.6% monthly increase in May (from -0.1% in April) and a 1.2% annualized uptick from last month’s 0.4% gain.
Friday marks a data dump day for Japan with Tokyo’s core CPI (1.0% expected vs. 1.1% previous), unemployment rate (expected to remain at 2.4%), and industrial production (0.5% expected vs. 0.6% previous) on tap.
Market risk sentiment
What’s a trading week without trading the yen as a safe haven?
The biggest story of the hour is the “extended meeting” between Trump and Xi Jinping in the G20 Summit in Osaka this week.
Traders will be looking for a de-escalation in the tariff war between the world’s two largest economies as well as a potential trade deal down the road.
If we see real progress in this week’s talks, then we could see higher-yielding bets shoot higher against the yen. But if either party walks away without a concrete plan, then risk aversion could dictate the yen crosses’ price action.
Meanwhile, the U.S. is set to announce new major sanctions on Iran after Trump aborted a military strike last week. The increased economic pressure aims to tempt Iran into negotiations over its oil exports, uranium enrichment plans, and other regional campaigns.
Word around is that France’s Emmanuel Macron and Germany’s Angela Merkel – who will also attend the G20 Summit – will attempt to caution Trump against increasing tensions in the Gulf.
Do you think the U.S. will stop at additional sanctions this week?
Missed last week’s price action? Read JPY’s price recap for June 17 – 21!