28 Jun 2013
Japan CPI next: Impact on the USD/JPY
FXstreet.com (Barcelona) - Japan is due to publish the latest inflation numbers at 23:30GMT - under 1h - with expectations this time for an increase in prices as the Abenomics policy starts to work its way through the economy.
As Valeria Bednarik, Chief Analyst at FXstreet.com, notes "With BOJ inflation target at 2.0%, and the stimulus already applied to the economy, we should expect a positive reading this month, and therefore more yen strength."
The interpretation that the market will probably give to the numbers is one in which inflation above expectations is seen as suggestive that things are going on as planned, and therefore no rush to expand for the moment. On the other hand, a reading below expected, "should send investors price in more facilities, and therefore, trigger some losses in JPY, particularly against the greenback" Bednarik points. However, the Analyst expects rallies to be limited within recent ranges.
As Valeria Bednarik, Chief Analyst at FXstreet.com, notes "With BOJ inflation target at 2.0%, and the stimulus already applied to the economy, we should expect a positive reading this month, and therefore more yen strength."
The interpretation that the market will probably give to the numbers is one in which inflation above expectations is seen as suggestive that things are going on as planned, and therefore no rush to expand for the moment. On the other hand, a reading below expected, "should send investors price in more facilities, and therefore, trigger some losses in JPY, particularly against the greenback" Bednarik points. However, the Analyst expects rallies to be limited within recent ranges.