USD/JPY (current price: 102.05)
The Philly Fed Manufacturing Index came in way higher than expected at 12.8, while Industrial Production, Retail Sales, and the PPI all came in slightly lower than the consensus estimate, at -0.4%, -0.3%, and 0.0% respectively. The mostly negative releases and the uncertainty regarding next week’s BOJ meeting led to a rally in the Yen, despite the bullish correction on global stocks. Further volatility is expected in the pair before next week’s crucial announcements.
Our assessment: The pair is hovering around the upper boundary of the declining long-term trend as the U.S and the Japanese economy are both slowing down and investors continue to focus on central bank policies.
