Dollar climbing slightly after Trump’s comments that he favors a strong dollar but the dollar returned to its downward trend
The Asian session was not as dull as most people would have thought it would be like any other session with minimum movement. However, it would seem the President of the United States, Mr. Donald Trump, has struck yet again into the market, where he explained the U.S. Finance Minister Munchin’s comments were taking out of context and that he favored a strong dollar, helped the dollar rally a bit before continuing in its current path.
Over in Asia specifically China, Economic News was released with the December Industrial Profits. This is important as China is the world’s factory and it the economy relies heavily on manufacturing. The actual figure came in at 10.8% versus November’s 14.9%. This shows that growth remains strong with double digits.
However, things don’t look so rosy for the Chinese interest rate hike as the Securities Journal explains that the Window is “not open yet” for hikes to begin.
Japan was another country that had its name in the headlines as the December CPI was due to be released which came in at 1.0% versus the 1.1% estimate. The Core CPI, however, came in as expected at 0.9%. The main focus for investors was the Bank of Japan Minutes which explained that most members say appropriate to continue powerful easing.
The European market takes over the Asian Session with the European Money Supply which is expected to remain the same. But the more important news comes from the United Kingdom where the Prelim GDP quarter on quarter is expected to come in at 0.4% indicating that there is steady, albeit, slow growth in the British Economy. This should give the Pound the extra push it needs to counter the move the President Donald Trump did with his comments about a strong dollar.
Dollar resumes its downward trend against the major after rallying overnight on U.S. President Trump’s comment he favors a stronger dollar. Investors await U.S. 4Q GDP and PCE data to see if the figures can lend support to the greenback. A lineup of heavyweight speakers in Davos will also be watched. Euro holds above 1.2400-handle following ECB’s Thursday.
USDJPY – The yen has fallen bearishly below the 110.00 handle as resistance mounts at 110.19 at January 17th low followed by 111.48 at January 18th high.
EURUSD – The pair seems to have enough strength to retest the 1.2500 handle, with Support seen at 1.2165 at the January 18th low followed by 1.2092 at September 8th high.
EURJPY – The Yuppy is consolidating below the January high with resistance seen at 136.64 and support at 135.02.
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