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Forex - USD/JPY weekly outlook: February 10 - 14

Published 02/09/2014, 05:37 AM
Dollar regains ground against yen after U.S. jobs report
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Investing.com - The dollar rose against the yen on Friday, rebounding from lows hit after data showed the U.S. economy added jobs at a slower-than-forecast rate in January.

USD/JPY ended Friday’s session up 0.22% to 102.33, after initially falling to lows 101.45. For the week, the pair gained 1.14%.

The pair is likely to find support at 101.23, Thursday’s low and resistance at 102.92, the high of January 31.

The U.S. economy added 113,000 jobs in January, the Labor Department said, well below expectations for jobs growth of 185,000, after December's lackluster gain of 75,000 jobs.

It was the weakest two-month stretch of job creation in three years as inclement weather contributed to a slowdown in hiring.

Yet the report also showed that the number of people participating in the labor force edged up to 63% from a 30-year low of 62.8% last month, while the unemployment rate unexpectedly ticked down to a five year low 6.6% from 6.7% in December.

The report was seen as unlikely to derail reductions in the Federal Reserve’s stimulus program. The bank announced a second $10 billion cut to its asset purchase program in January, reducing it to $65 billion-per-month.

Elsewhere, the yen was also lower against the euro, with EUR/JPY ending Friday’s session at 139.53, up 0.55% for the day.

Earlier Friday Germany's constitutional Court ruled that the European Central Bank’s bond-buying program may exceed its mandate, and referred it to European Court of Justice.

In the week ahead, Fed Chair Janet Yellen is to testify on the bank’s semiannual monetary policy report in Washington. Her comments will be closely watched. U.S. data on retail sales and consumer sentiment will also be in focus.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, February 10

Japan is to produce data on the current account, bank lending and consumer confidence.

Tuesday, February 11

Markets in Japan are to remain closed for a national holiday.

Federal Reserve Chair Janet Yellen is to testify on the bank’s semiannual monetary policy report before the House Financial Services Committee, in Washington.

Wednesday, February 12

Japan is to release data on core machinery orders and tertiary industry activity.

Thursday, February 13

The U.S. is to produce data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity. The nation is also to release the weekly report on initial jobless claims.

Federal Reserve Chair Janet Yellen is to testify on the bank’s semiannual monetary policy report before the House Financial Services Committee, in Washington.

Friday, February 14

The U.S. is to wrap up the week with the closely watched preliminary reading of the University of Michigan consumer sentiment index. The U.S. is also to release data on import prices and industrial production.

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