On Monday, the yen weakened following a statement from the central bank governor updating on economic progress and inflation.
Haruhiko Kuroda, Bank of Japan Governor stated the economy is on a possible moderate growing trend with core consumer prices somewhat negatively to flat, adding that the central bank will take additional action to increase growth if needed.
USD/JPY adjusted at 104.23, up 0.07%, while AUD/USD traded at 0.7597, down 0.26%. GBP/USD traded down 0.16% to 1.2168.
The U.S. dollar index, which gauges the greenback’s strong point against a trade influenced basket of six major currencies, increase 0.06% to 98.14.
This week will see the European Central Bank’s post policy meeting press conference on Thursday during assumption over whether it will further expand its stimulus program in the face of weakening progress and inflation. Also on the watch list are Chinese figures on 3rd quarter GDP, scheduled for release on Wednesday, with the rate of development expected to ease again.
This approaching Friday, U.S. Federal Reserve Chair Janet Yellen will give a speech. On Friday the previous week, Yellen recommended the Fed may need to run a “high-pressure” economy in order to reverse loss from the global financial crisis that depressed production, raising questions about long term policy, although not investor views the Fed is possible to increase interest rates in December.
On Monday, the euro zone is to post revised data on inflation, and the U.S. will report industrial output and manufacturing activity in the New York region. Among policy makers, ECB President Mario Draghi will speak on an occasion in Frankfurt and Fed Vice Chair Stanley Fischer will speak in New York.
The previous week, the greenback manages to increase on Friday as solid data on U.S. retail sales and producer prices strengthened expectations that the Federal Reserve could increase interest rates in the approaching months.
U.S. retail sales increase 0.6% in September after dropping 0.2% the prior month, data from the Commerce Department presented on Friday.
Another report presenting that U.S. producer prices lift up largely the previous month added to the view that the economy is on a strong enough footing for a rate hike by the Fed before the end of the year.
The reports came after the minutes of the Fed’s September meeting, published on Wednesday, showed several representatives believed it would be proper to increase interest rates “relatively soon” if the economy continued to progress.
For the 1st time in almost a decade in December, the U.S. central bank increased rates, but rates have stayed on hold since then during fears over sluggish inflation.
The next Federal Reserve meeting is in November, however, a rate hike ahead of the Presidential election is seen as doubtful.
Anticipations for higher rates normally increase the greenback by making it more attractive to yield seeking investors.
Investors have currently priced a 69.5% possibility of a rate hike at the Fed’s December meeting, according to the reports.
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