© Dukascopy Bank
The USD/JPY pair was trading in a calm manner, without major spikes or falls. The pair opened a new week on a rather negative note, however, almost immediately started to decrease in value since Tuesday. Meanwhile, Japanese Prime Minister Shinzo Abe pledged to lower the corporate tax rate by at least 3.3 percentage points next year, following through on a previously announced plan. Concerning the economic news, as usual, the limited amount was announced. Japanese gross domestic product contracted at an annualized 1.2% in the second quarter. By the end of the week, the pair reached 120.7 level late on Friday and ended the week up by 2%.
Compared to the previous week the bullish sentiment weakened and was changed bearish outlook. Now only 54% of traders expect the pair to decline, comparing to the previous week 33% of short votes. However, the average median for the pair for the end of this week rose to 121.
As usually, the vast part of economic news will come from the United States this week including retail sales, industrial production and manufacturing activity in the New York region on Tuesday. The next day figures on consumer price inflation will be published. Moreover, on Thursday the US is to release reports on jobless claims, building permits and housing starts while later in the day, the Federal Reserve is to announce its latest monetary policy decision at the conclusion of its two day meeting However, from the Japanese side, traders could pay additional attention to the trade balance data on Thursday. However, on Friday, the Bank of Japan is to produce the minutes of its latest monetary policy meeting.
© Dukascopy Bank