Global growth uncertainty and rate cut speculations kept the yen strong against its counterparts. Can this week’s releases change its trends?
Let’s take a look at the yen’s potential market movers:
Data printed earlier today showed core machinery orders dropping by 7.8% in May, which marks the first decline in four months and the largest since September 2008. Turned out, decreases in both manufacturing AND non-manufacturing orders dragged on the report. Yikes!
The PPI report (Jul 9, 11:50 pm GMT) should give us clues on Japan’s manufacturing trends. Analysts expect to see another 0.1% decline in June, while the annualized reading is estimated to slow down from 0.7% to 0.4%.
And then there’s May’s industrial production numbers (Jul 12, 4:30 am GMT), which could confirm or contradict today’s core machinery data. Analysts expect another 2.3% gain, though a much worse-than-expected figure could weigh on the yen across the board.
Market risk sentiment
What’s a trading week without trading the yen as a safe haven? If you recall, the low-yielding currency took advantage of global growth concerns as well as markets pricing dovish biases of major central bankers.
This week we’ll know more from the Fed as it prints its meeting minutes from last month. Watch out for clues on how urgent members feel about another rate cut.
Meanwhile, scheduled speeches by several members should give us clues on how last Friday’s NFP report has affected their short-term biases.
But wait, the Fed isn’t the only central bank with an opportunity!
Aside from the BOC printing its monetary policy decision this week, key members from the RBNZ, BOE, ECB, and BOJ also have scheduled speeches that could turn into tradeable events. Make sure you check out your forex calendars and mark them speeches!
Missed last week’s price action? Read JPY’s price recap for July 1 – 5!