The US dollar has posted slight gains on Monday, as USD/JPY trades slightly short of the 108 line. Taking a look at today’s events, the US will release Pending Home Sales. The markets are expecting a strong improvement, with an estimate of 1.1%. Japan will release Retail Sales, an important gauge of consumer spending. The forecast stands at 0.9%.
On Sunday, the Japanese Services Producer Price Index posted a strong gain of 3.5%, matching the forecast. With deflation eliminated, the next challenge for the government and the BoJ is boosting economic growth. We’ll get a look at consumer numbers during the week, with Retail Sales on Monday and Household Spending on Thursday.
In the US, last week’s jobless numbers were softer than expected. Unemployment Claims rose to 284 thousand, much higher than the previous reading of 264 thousand, and above the estimate of 269 thousand. However, the markets were not overly concerned, as the four-week average, which is less volatile than the weekly release, dipped to 281,000, a 14-year low. Meanwhile, weak inflation levels continue to point to slack in the economy. On Wednesday, this trend continued with soft consumer inflation numbers. CPI and Core CPI both posted small gains of 0.1%.
USD/JPY 107.77 H: 108.19 L: 107.74
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