Fundamental analytics

What’s next? – USDJPY 23.02.18

USDJPY

The dollar was trading 0.13 percent higher vs the Japanese yen at 106.88 as of 09:45 GMTon Friday, as the dollar continued to gain against major rivals.

The US dollar index, which measures the greenback against six major currencies, was trading 0.11 percent higher at 89.76 by the time of this writing.

Earlier this week, the American currency was boosted by the release of the latest monetary policy meeting minutes of the Federal Reserve, which confirmed readiness to rate hikes soon.

According to Fed funds tracked by CME Group’s FedWatch program, market participants are currently weighing an 85 percent probability of a 25 basis-point rate hike by March.

However, St Louis Fed President James Bullard said Thursday that increasing interest rates too many times this year could have a negative effect on economic growth.

In other news, New York Fed President William Dudley also spoke in the previous session, but did not comment on monetary policy issues. Instead, the policymaker, whose district includes Puerto Rico, said the island should take this difficult moment to rebuild its infrastructure. On September 20, 2017, Puerto Rico was affected by the worst storm in 90 years.

On the data front, not many publications were made. Initial jobless claims were the main focus. They came in at 222,000 against 230,000 estimated and a prior 229,000.

Ahead in the day, no macroeconomic reports are due for release, so attention will rather shift to speeches from FOMC members Dudley and Rosengren at 15:15 GMT, Mester at 18:30 GMT and Williams at 20:40 GMT.

As the pair has broken below 107.00, we could expect some further downward pressure to weigh on it, although the position is stable and we could see a rebound out of the blue.

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