Fri, Jul 14 2017, 12:40 GMT

by Fort Financial Services

The dollar/yen was up 0.14 percent as of 05:25 GMT on Friday, trading around 113.45 in the light of downbeat economic data from Japan.


Japan’s Ministry of Economy, Trade and Industry said industrial production fell 3.6 percent in May, below the initial forecast and previous decline of 3.3 percent.


Fed Chair Janet Yellen testified before the House Financial Services Committee for the second day on Thursday, emphasizing the improvements of the US economy and reminding that the plan to gradually raise interest rate is still active.


Yellen explained that the labor market "is quite tight which cause pressure on wages." and that while inflation has dropped in recent months, she still believes it’s rather "premature to say the underlying inflation trend is below 2 percent."


Her comments provided strong support to the US dollar, which strengthened against the yen and other major rivals across the currency market.


According to Fed funds tracked by CME Group’s FedWatch program, traders are currently pricing in a 47.2 percent probability for a rate move by December.


Ahead in the session, investors await an important batch of data from the United States, including the consumer price index, retail sales and industrial production for June.


Also, the University of Michigan will release preliminary readings on its consumer expectation and consumer sentiment indexes, with 84.0 and 95.0 eyed.


From a technical view, the pair is now looking to the 113.50 mark as an immediate target. If we can clear that level, an upward extension to 115.00 seems likely. Strong volatility is expected ahead of inflation data in the United States.

 

Published on Fri, Jul 14 2017, 12:40 GMT

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