USD/JPY pushes higher in Asian trade
The US dollar made an early advance against its Japanese counterpart, breaching the 98.00 barrier on the heels of weak trade data. Japan’s Ministry of Finance reported a worse-than-expected trade deficit for the month of July. Export exports grew at an annualized rate of 12.2 percent, higher than the previous month but lower than expectations for 13.1 percent. The US calendar was idle Monday as investors eye the reading of the July FOMC meeting minutes on Wednesday.
The USDJPY consolidated in the North American session following a gain of more than 0.35 percent in Asian trade. At the end of the New York day, USDJPY was trading at 97.6700, a gain of 0.12 percent. The trend index points to a bearish downside for the pair after its early rally. The pair’s first barrier is 98.03, followed by 98.27. On the downside, the pair’s first support is 97.28, followed by 97.04.
Action heats up during the second half of the week following the release of existing US home sales. July home sales are expected to rise 1.5 percent after a lackluster June saw sales slump 1.2 percent. Bad weather was blamed for the weak reading.
Thursday’s report on jobless claims will also influence US dollar pairs ahead of the weekend. Jobless claims for the week ended August 9 declined to their lowest level since 2007 with a reading of 320,000. Thursday’s reading is expected to show 322,000 claims were filed for the week ended August 16. The US data wire closes out the week with a report on July new home sales.
The focus for USDJPY will be on Wednesday’s FOMC minutes. The pair traded within a narrow range in Monday’s New York day as the markets consolidate ahead of the FOMC. Over the long-haul, the pair is expected to rally on further yen debasement emanating from Bank of Japan stimulus. A shift in US policy is also likely to create broad support for the greenback, as higher interest rates and a reduction in federal stimulus make the US dollar a more appealing option.
Sorry. No data so far.