© Dukascopy Bank SA
On Monday, the Yen entered a strong bullish territory versus the Dollar, pushing the pair to 124.71 level, however, the upward tendency was temporal. The next day, the Greenback hovered near five-week highs versus the Yen, after a top Federal Reserve official added to expectations that US interest rates could be raised as early as in September. The next day, the data on Japanese export volume released the export soared 9.5% in June from a year earlier, but volumes were unchanged. Meanwhile, foreign demand for Japanese goods remained flat despite the Yen's weakness. Japan's imports, in turn, fell 2.9%, creating a 69 billion yen trade deficit. Separately, the International Monetary Fund cautioned that unless Japan addresses its debt through spending cuts and more realistic budget forecasts, its debt could expand by three times the size of its economy by 2030. The pair closed the week on the rather negative note at 123.7 back on Friday, July 24.
This week traders' expectations changed notably, as now 71% of Dukascopy Community members estimate the pair to gain in value. The next week is not expected to be rich on Japanese economic announcements nevertheless, traders still could pay additional attention to the coincident index and leading economic index on Wednesday. From the American side, in the same day, the Fed is to announce its latest monetary policy decision and publish the rate statement, while on Thursday, the US is going to publish preliminary data on second quarter growth and the weekly report on initial jobless claims. Eventually, the US is to round up the week with revised data on consumer sentiment and a report on business activity in the Chicago region.
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