Dollar/Yen Falls With Stocks And Looks Forward To Powell

The inflation data will likely be overshadowed by the testimony by Fed Chair Jerome Powell’s testimony. The world’s most powerful central banker made several public appearances in recent weeks — his comment about interest rates being “just below” the range considered as neutral sparked a market rally on hopes that the Fed is nearing the end of its tightening cycle. However, a more in-depth look at the same speech and his more recent speech changed the picture.

The prepared remarks are published before the event and will help clarify the intentions of the Fed. He will then face lawmakers for a lengthy Q&A session in which he could provide further insights, one week before the Washington-based institution is set to raise rates and publish a fresh forecast for the path of interest rates in 2019.

Thursday sees the weekly jobless claims which dropped after gaining beforehand, yet a more substantial event awaits on Friday: Retail Sales. The US economy is centered on consumption and consumers were out and about in October: the volume of sales rose by 0.8%, core sales by 0.7%, and the control group by 0.3%. We will now receive figures for November, the month including Black Friday.

Here are the top US events as they appear on the forex calendar:

US macro economic events December 10 14 2018

Japan: Following Stocks, which follow trade talks

While the greenback attracts some safe-haven flows, the Japanese yen is the No. 1 safe-haven currency. The currency of the Land of the Rising Sun rises when stocks fall. The primary downside driver for shares has been trade or lack of progress on trade talks. The pair will likely continue following comments from both China and the US, with a special focus on Trump’s tweets. Progress on talks or gestures such as the release of Meng or China buying US goods could alleviate tensions and push the yen lower.

In Japan, the Tankan survey data will be of interest and the numbers may drop from the highs. The Bank of Japan uses the data in its calculations.

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