USD/JPY: Bulls loosen grip ahead of US Q2 GDP
Currently, the USD/JPY pair trades 0.25% at 120.25, gradually retreating from session highs posted at 120.55. The major did manage to conquer the 120.40 key levels in the early trades, although failed to sustain above the last and retraced to familiar ranges near 120.20 during the European afternoon.
The major remained bid as the traders continue to favour the US currency ahead of the crucial Q2 GDP report from the US which is expected to reveal an annualized 3.2% expansion for the second quarter, measured on a quarterly basis, following the 0.2% contraction in the first quarter. It would be better than the first estimate of a 2.3% rise.
Moreover, slightly hawkish comments from Fed George delivered in the last hours also lent a helping hand to the buck, keeping the USD/JPY pair buoyed. .
GBP/USD: Breakout turns into Fakeout, drops to 1.5650
The preliminary German manufacturing PMI in August rose to a 16-month high of 53.2 from July’s 51.8.
The services PMI dropped to a three-month low of 53.6, restricting the composite index to a 4-month high of 54.00. The Markit report shows, “New orders placed with German private sector companies also rose at a faster pace in August. Goods-producers reported the sharpest rise in new export orders in one-and-a half years. The rate of job creation accelerated to a 44-month high.”
On the price front, companies reported a sixth successive monthly rise in input costs in August. Output prices also rose further during August, with the rate of inflation the highest in three months.
GBP/USD drops into the red on Fed George’s comments
The spot was quickly offered to daily lows once it broke below 1.5460 (61.8% of June rally). The USD bulls made a comeback today after the spot failed to sustain above 1.55 levels. The bearish pressure on the Sterling intensified after the upside breakout from the multi week range of 1.5460-1.5690 quickly failed as the spot made its way back in the range.
The focus now shifts to the second estimate of the US Q2 GDP, which is expected to show the economy expanded 3.2%, compared to the initial reading of 2.3%.
| Important events and their explanation: |
| Time ( IST) | Currency | Economic | Actual | Expectation | Previous | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Explanation:-As we are heading towards the last day of the week and with the most crucial data. Out of the above data s the most crucial are Personal spending and Consumer Sentiments. As per our analysis, above data would be positive for the USD and negative for the INR. |
Quick Glance : |
| Instrument | Price | %Chg | Volume | OI |
| USD/INR | 66.02 | 0.17 | 788526 | 960103 |
| EUR/INR | 74.58 | -0.82 | 37048 | 48836 |
| GBP/INR | 101.95 | 0.07 | 21059 | 41217 |
| JPY/INR | 54.92 | -0.64 | 7908 | 15311 |
| Technical touch : |
As said yesterday, after RBI s intervention rupee tried to maintain its lost ground. For the tomorrow’s trade we assume USDINR might fall till 66.25 levels