The pressure on Canada

April 29, 2016

The price action on the yen is indicative of a currency that has changed course. After yesterday’s substantial bout of yen appreciation, we’ve seen more gains overnight, this despite the holiday in Japan today. This puts USDJPY at levels last see 18 months ago, having moved below the 107.00 level into the European open. Many started the year bearish on the yen, on the basis of policy divergence, so sentiment amongst longer-term players is now starting to shift, which will be a difficult barrier for the BoJ and MoF to overcome. Furthermore, the perception that the yen remains undervalued on longer-term measures remains, this also being seen in the recovery in the current account over the past year, which generally pre-dates increases in the yen. EURJPY is also touching some key levels today, holding just above the 122.00 level in early European trade, leaving the 121.70 level (18th April low) as the key level to watch to take it onto level last seen 3 years ago.

The main focus today will be with activity data in Canada, where the latest monthly GDP data for February is seen contracting by 0.2%. USDCAD continues to resemble a one-way street, now threatening a break of the 1.25 level. Combine this with the slower pace of growth seen in the US in the first quarter, the competitive conditions are getting more troublesome for Canada. If this continues, it’s going to be difficult to see the BoC holding rates steady at their current level.

Publication source
FxPro information  FxPro reviews

September 29, 2016
OPEC blinks
Yesterday decision by OPEC to restrict oil supply has pushed the price of crude higher by some 5%. The move took the markets by surprise, with the divisions between Iran (who are still enjoying their return to global markets)...
September 29, 2016
Gold weighed down by US data
The gold price is down for a second straight day today as investors await a raft of data from the US this week which may decide the question of an interest rate hike...
September 29, 2016
Informal OPEC meeting seizes limelight
Global stocks were chaotic on Tuesday with most equities vibrating between losses and gains as the mixture of anticipation ahead of OPEC - informal meeting and ongoing discussions over the results of the first presidential debate created explosive levels of volatility...

FOREX.com Rating
FXCM Rating
FIBO Group Rating
Vantage FX Rating
Tickmill Rating
Orbex Rating

Empire Option Rating
OptionFair Rating
365BinaryOption Rating
Beeoptions Rating
Banc De Binary Rating
OptionBit Rating