© Dukascopy Bank SA
USD/JPY currency pair was rather volatile during the January 26-30 trading week, showing both gains and looses. The pair started previous week on a rather low 117.71 level. On Tuesday, Japanese data showed that retail sales for December rose 0.2% on a yearly basis, compared to a projected gain of 0.9%. Meanwhile, Japan's trade deficit narrowed to an 18-month low in December, indicating some benefit from Prime Minister Shinzo Abe's aggressive efforts to devalue the Yen. Exports grew 13% the same month from a year earlier, while imports rose just 1.9% on weak domestic demand and plummeting oil costs. Therefore, country's trade deficit has been halved from a year ago. On Thursday, the US Dollar was steady against the Yen since the Federal Reserve outlined that interest rates could be raised in the middle of the current year. From Japanese side, a big bunch of statistics was announced that day. The consumer price index stayed unchanged at 2.4% in December on the yearly basis, while core CPI has also posted no significant changes and stayed at 2.1%. Meanwhile, unemployment level in the country fell to 3.4% in January. Moreover, Japan's industrial production rose 0.3% on a yearly basis, indicating that the economy is slowly recovering from a slump provoked by a sales tax increase in April 2014. As a result, the cross failed to recover on Friday and closed the period at 117.18.
This week the general sentiment on USD/JPY cross is staying unchanged. Among important events, traders could pay attention to the PMI releases both in Japan and the US on Wednesday. By the end of the week on Friday, United States are due to publish non-farm payrolls and unemployment rate numbers, while from the Japanese side there will be a release of both the leading economic index and coincident index.
© Dukascopy Bank SA