USD/JPY – Japanese yen dips, consumer data ahead

USD/JPY has edged higher on Wednesday. In the North American session, the pair is trading at 110.32, down 0.28% on the day. On the release front, there are no Japanese indicators. In the U.S., the trade deficit narrowed to $51.1 billion, better than expected. On Thursday, the U.S. releases Final GDP and unemployment claims. Japan will publish Tokyo Core CPI and retail sales.

The nasty trade war between the U.S. and China has hit Japan hard, as both countries are major trading partners with Japan. The weaker global climate has resulted in weaker demand for Japanese exports, and there are growing concerns that the fragile economy could be heading for a recession. Earlier in the week, the BoJ released the summary of opinions from the March policy meeting. Policymakers debated whether to ramp up stimulus in order to boost growth. Inflation levels remain sluggish, and the scheduled tax hike in October, which is certain to weigh on growth, poses another headache for policymakers.

After a sharply dovish Fed meeting last week, investors are in a sour mood. The Fed said that it had no plans to raise rates before 2019, and also lowered its growth forecast for 2019 to 2.1%, down from 2.3% in December. As well, the spread between 3-month and 10-year Treasury notes turned negative on Friday, signifying the dreaded inverted yield curve. This curve has preceded every U.S. recession over the past 60 years, so it’s no surprise that this has caused consternation among investors.

Lest we quickly forget

Today’s U.K Parliament Brexit Agenda

USD/JPY Fundamentals

Wednesday (March 27)

  • 8:30 US Trade Balance. Estimate -57.2B. Actual -51.1B
  • Tentative – US Current Account. Estimate -130B
  • 10:30 US Crude Oil Inventories. Estimate -1.1M
  • 17:30 US FOMC Member George Speaks

Thursday (March 28)

  • 8:30 US Final GDP. Estimate 2.4%
  • 8:30 US Unemployment Claims. Estimate 222K
  • 19:30 Tokyo Core CPI. Estimate 1.1%
  • 19:50 Japanese Retail Sales. Estimate 0.9%

*All release times are EST

*Key events are in bold

USD/JPY for Wednesday, March 27, 2019

USD/JPY March 27 at 11:00 DST

Open: 110.64 High: 111.72 Low: 110.24 Close: 110.37

USD/JPY Technical

S3 S2 S1 R1 R2 R3
108.11 109.37 110.28 110.90 112.16 112.93

USD/JPY posted slight losses in the Asian session and edged higher in European trade. The pair has ticked higher early in North American trade

  • 110.28 is providing support
  • 110.90 is the next resistance line
  • Current range: 110.28 to 110.90

Further levels in both directions:

  • Below: 110.28, 109.37 and 108.11
  • Above: 110.90, 112.16, 112.93 and 113.70

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Market Analyst at OANDA
A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in several major online financial publications including Investing.com, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.