Yen Selloff, RBNZ and BoC will start Hike again this week

Yen trading resumed in the Asian session with USD / JPY re -establishing a new high. The ruling Liberal Democratic Party and its young ally Komeito won Japan’s upper house election. There may be sympathy options for the tragic death of Prime Minister Shinzo Abe. But it is seen as part of Abe’s legacy in returning Japan as a “normal” country with a strong military and alliance with the US. The Dollar is the strongest right now, followed by the Swiss Franc and then the Kiwi. The Aussie, on the other hand, is the second weakest after the Yen, followed by Sterling.

Technically, a big idea for the week is about the recent rise of the EUR / USD low from the current level. The highest level to look at is parity. A break of the 1.0348 support turned the resistance into the first sign of stabilization, and brought about consolidations. But continued parity can push the sale deeper, threatening the bottom line.

In Asia, at the time of writing, the Nikkei was up 1.26%. Hong Kong’s HSI was down -2.74%. China Shanghai SSE was down -1.46%. The Singapore Strait Times rose 0.06%. Japan’s 10 -year JGB yield was down -0.005 by 0.246.

BoJ Kuroda: We will not hesitate to do the fundraising activities as needed.

BoJ Governor Haruhiko Kuroda said the economy was “very high” due to rising prices. While the economy is showing some signs of weakness, overall it is continuing to rise as a whole.

“We will not delay in making further investment measures as necessary,” he added, citing those short and long -term opportunities to “move to current or lower levels. “

Released from Japan, M2 rose 3.3% yoy in June with an expected 3.4% yoy. Machine orders fell -5.6% mom in May, with expectations of -5.5% mom.

NZD/USD on the upside, looking for support from 0.6098 high projection

NZD / USD is currently hovering above 0.6123 low, waiting for the RBNZ to rise later in the week. A rebound is expected from the current high of 0.6098 (100% projection of 0.7463 to 0.6528 from 0.7033). But a break of 0.6251 small resistance should be the first sign of downturn, while a solid break of 0.6395 is sure to confirm. However, a constant break of 0.6098 will further challenge the pace below the 161.% projection at 0.5520, which is close to 0.5467 (2020 low).

AUD/CAD stays lower, more pressure is down

The Canadian currency is now more valuable than any other currency and will remain stable. The Loonie is expected to reunite if BoC chooses a 75bps increase this week, instead of 50bps.

Looking at AUD/CAD, it is sitting well in the trend from 0.9991 (2021 high). Outlook remains bearish until the 0.8916 low resistance. A low of 0.8744 indicates a continuation. The 100% projection is 0.9991 to 0.8906 from 0.9514 to 0.8429.

However, a firm break of 0.8916 would indicate a short -term downside and take the first strong rebound.

RBNZ and BoC are the biggest rising, US CPI and retail prices

Two central banks are expected to generate revenue this week. The RBNZ should raise the standard deviation by another 50bps to 2.50%. According to the RBNZ’s own forecast in May, the OCR could rise to as high as 3.9% in Q2 2023, before falling slowly in the second half of 2024. There is little to suggest. the RBNZ is going to leave him. Therefore, a hawkish atmosphere must be maintained.

Expectations are set for BoC to grow by 50bps or 75bps this week. Gov. Tiff Macklem said on June 9, “We need to do more to bring inflation back to target. And if we don’t need to move faster, we need to move faster. make it bigger. “But you’re not sure if that really translates to a big increase now. The BoC will also issue a new monetary policy statement with economic forecasts.

On the preliminary data, US CPI and retail sales are likely to capture much of the attention. Instead, the focus will be on Germany ZEW, UK GDP, and a set of data from China, including trade balance, GDP, retail sales and business activity. Here are some highlights for prayer:

  • Monday: Japanese machine orders; Italian retail sales.
  • Tuesday: Japan PPI; Australia Westpac customer confidence, NAB industry confidence; Germany ZEW.
  • Wednesday: RBNZ statistics; China’s trade border; Germany post -CPI; UK GDP, products, trade equity; Eurozone industry; US CPI; The BoC decision; Puke beige and Fed.
  • Thursday: Australia’s economic growth prospects, performance; Swiss PPI; The sale of Canada; US PPI, unemployment rate.
  • Friday: New Zealand BusinessNZ manufacturing; China’s GDP, retail sales, industrial production, real estate investment; Japanese high school education report; Eurozone trade balance; Wholesale in Canada; U.S. retail sales, Empire State operations, import prices, technology, Michigan consumer sentiment, stock markets.

USD/JPY Daily Exchange

Daily Pivots: (S1) 135.42; (P) 136.00; (R1) 136.66; More…

A break of 136.99 indicates the resumption of the trend in USD / JPY and the intraday bias has returned to the side. The stock continues above 136.99 confirming and confirming the 100% projection of 114.40 to 131.34 from 126.35 at 143.29. In the meantime, the sentiment will continue to be bullish as long as the 134.73 support holds, if it leaves.

In the bigger picture, the current combination is seen as a segment of the long term from 75.56 (2011 low). The next target is a 100% projection of 75.56 (2011 low) to 125.85 (2015 high) from 98.97 to 149.26, which is close to 147.68 (1998 high). This will continue the desired trend as long as the 126.35 support remains.

Economic Update

GMT Ccy Events it’s true I guess Used to Edited
23:50 JPY Donate M2+CD Y/Y Jun 3.30% 3.40% 3.20% 3.10%
23:50 JPY M/M Commandments May -5.60% -5.50% 10.80%
06:00 JPY Machine Tool Instructions Y/Y Jun P 23.70%
08:00 EUR Sales Report M/M May 0.70% 0.00%

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