Market Fundamental Analysis by RoboForex

[RoboForex Team]

USDJPY heads down: demand for the yen has risen significantly

The USDJPY pair is losing ground. The market favours the yen as a safe-haven asset. Discover more in our analysis for 5 September 2024.

USDJPY forecast: key trading points

• The USDJPY pair fell to a two-month low
• Japan’s robust domestic statistics and weak US reports are supporting the yen
• USDJPY forecast for 5 September 2024: 141.46

Fundamental analysis

The USDJPY rate halted its decline near the 143.69 level.

The pair is hovering near a two-month low after an active two-day sell-off. The yen’s strength is now based on the latest statistics from Japan. Data showed that real wages in the country rose in July for the second consecutive month, adding 0.4% y/y. Overall cash earnings increased by 3.6%.

This aligns with the Bank of Japan’s forecast for moderate economic growth rates. Additionally, such data supports expectations of wage increases, which will lead to higher overall inflation.

In addition to domestic statistics, the yen benefitted from growing market demand for safe-haven assets following the release of relatively weak US statistics. The figures reminded investors of a potential recession in the US economy, which boosted demand for safe-haven assets. The USDJPY forecast suggests local growth in the yen.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[RoboForex Team]

EURUSD rose: the market awaits US employment market statistics

Supported by expectations regarding the Federal Reserve’s policy, the EURUSD pair returned above 1.1100, rising for the third consecutive session. Find out more in our analysis for 6 September 2024.

EURUSD forecast: key trading points

• The EURUSD pair has resumed steady growth
• Today, investors are awaiting the crucial US employment sector releases for August
• EURUSD forecast for 6 September 2024: 1.1133, 1.1026, and 1.0985

Fundamental analysis

The EURUSD rate climbed to 1.1115.

The first release of US employment market data for August surprised the market yesterday. ADP private sector jobs increased by only 99,000, missing the forecast of 144,000 and falling short of the previous increase of 122,000. While there is no direct correlation between these figures and nonfarm payrolls, the sentiment is clear: the employment market is losing jobs.

This may prompt the US Federal Reserve to act even more swiftly than planned. In this context, today’s statistics are crucial, with the US unemployment rate report for August scheduled for release this evening. The main forecast suggests a decrease to 4.2% from 4.3%. Nonfarm payrolls could expand by 164,000 following previous growth of 114,000. However, statistics may bring surprises.

The EURUSD forecast suggests an increase in volatility later this afternoon.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[RoboForex Team]

Gold (XAUUSD) remains in a sideways range; the market awaits US inflation statistics

The XAUUSD price has been trading in a sideways range for three weeks; the direction of the price movement out of the range may determine the future trend. The market will focus on US inflation data this week. Find out more in our XAUUSD analysis for today, 9 September 2024.

XAUUSD forecast: key trading points

• Market focus: market participants are awaiting US inflation statistics this week
• Current trend: gold is consolidating within a sideways range
• XAUUSD forecast for 9 September 2024: 2,532 and 2,470

Fundamental analysis

Friday’s US employment market statistics aligned with the forecasts, with nonfarm payrolls showing growth of 142,000 and the unemployment rate declining to 4.2%. US stock indices responded to this data with a fall, and gold also corrected downwards from its annual high of 2,532 USD to 2,500 USD.

Market participants will focus on US inflation statistics this week, with the Consumer Price Index (CPI) and the Producer Price Index (PPI) scheduled for release. A decline in inflation will exert pressure on the USD and help strengthen gold. Conversely, a rise in inflation will support the US dollar, potentially causing XAUUSD quotes to fall.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[RoboForex Team]

USDJPY remains flat: the market is awaiting signals

The USDJPY pair has halted its rise and is consolidating. Investors have a busy week ahead. Find out more in our analysis for 10 September 2024.

USDJPY forecast: key trading points

• The USDJPY halted its ascent
• The market is still betting on a decisive monetary policy tightening by the Bank of Japan
• USDJPY forecast for 10 September 2024: 139.70

Fundamental analysis

The USDJPY rate is hovering around 143.25 on Tuesday. Last week’s gains for the yen appear to be offset, with the US dollar regaining ground ahead of the release of crucial inflation statistics this week.

The JPY rate rose by more than 3.00% over the past week, with the USDJPY pair falling to annual lows. This became possible due to expectations of future decisive steps by the Bank of Japan. In making a decision to raise interest rates before the end of the year, the BoJ could be supported by the continued growth of wages in the country and persistent inflationary pressure.

It became known a little earlier that the Japanese economic growth rate slowed in Q2. The country’s GDP grew by 2.90% year-over-year, falling short of the preliminary estimate of 3.10%. The USDJPY forecast is still neutral.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[RoboForex Team]

USDCAD: the US dollar continues to strengthen

The US consumer price index at last year’s level and the rest of the fundamental data package may further drive the USDCAD pair. Discover more in our analysis for 11 September 2024.

USDCAD forecast: key trading points

• The Thomson Reuters/Ipsos primary consumer sentiment index in Canada (PCSI): previously at 50.06
• The US consumer price index (m/m) for August: previously at 0.2%, projected at 0.2%
• The US consumer price index (y/y) for August: previously at 2.9%, projected at 2.5%
• USDCAD forecast for 11 September 2024: 1.3700

Fundamental analysis

The primary consumer sentiment index is calculated by Thomson Reuters/Ipsos and measures consumer sentiment based on a target group survey. The index increased to 50.06 last month, indicating positive consumer sentiment. The forecast for 11 September 2024 may be disappointing for the Canadian dollar, with the USDCAD rate continuing its ascent after a correction.

The expected fundamental news for the USDCAD pair may be called neutral. According to analytical forecasts, almost all data may be released in line with expectations or with minor deviations.

There is a package of US news, including year-over-year and month-over-month consumer price indices for August. They reflect changes in consumer goods and services prices and are key indicators for the direction of purchases and US inflation. Readings below the forecast are considered negative for the US dollar, while those above are considered positive.

The forecast suggests that the CPI index may remain flat at 0.2% month-over-month and slightly decrease to 2.5% year-over-year. Expectations that the estimates will align with actual data are so far low. An increase in indicators may further boost the USDCAD pair.

Despite the news, the USDCAD forecast for 11 September 2024 appears positive for the US dollar as it may strengthen its position against the Canadian dollar. Actual data aligning with the forecast may also drive growth in the pair.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[RoboForex Team]

EURUSD: rising US core inflation has almost ruled out a 50-basis-point Fed interest rate cut

The EURUSD rate is slightly correcting following a decline caused by a rise in US inflation. Discover more in our analysis for 12 September 2024.

EURUSD forecast: key trading points

• US core inflation unexpectedly rose by 0.3% in August from July, marking the highest reading in four months
• The likelihood of a 50-basis-point Federal Reserve interest rate cut at the next meeting is virtually ruled out, while the odds of a 25-basis-point cut (market expectations) are 87%
• The European Central Bank is expected to lower the key rate by 25 basis points today
• According to analysts, the EURUSD rate may fall to 1.0200 by the end of the year amid ECB monetary policy tightening
• EURUSD forecast for 12 September 2024: 1.0986 and 1.0950

Fundamental analysis

US core inflation unexpectedly rose in August, driven by increased housing and travel prices. The core CPI, excluding food and energy costs, increased by 0.3% from July, marking the highest reading over the past four months. Headline inflation ran at 0.2% m/m and 2.5% y/y. This unexpected rise in inflation may prevent the Federal Reserve from lowering interest rates aggressively despite signs of a slowing employment market.

The current inflation data changed market expectations, pushing the EURUSD rate slightly down. The likelihood of a 50-basis-point Federal Reserve interest rate cut at the upcoming meeting is now virtually ruled out. Instead, expectations of a 25-basis-point cut are estimated at 87%, while the odds of a more significant 50-basis-point reduction have dropped to 13%. The market has already priced everything in, although analysts had expected to get clarity on interest rate issues only by Friday.

At the same time, the European Central Bank is expected to lower the key rate by 25 basis points today. This decision is due to the fact that inflation in the eurozone eased to 2.2% in August, wage growth slowed, and the GDP Q2 growth forecast was revised to 0.2%. According to analysts, the EURUSD rate may decline to 1.0200 by the end of the year amid ECB monetary policy tightening in response to the weakening economy. The current ECB meeting may directly impact today’s EURUSD forecast and become a significant catalyst for the currency market, showing that the regulator can cut rates faster than currently expected.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[RoboForex Team]

USDJPY at annual lows: this is not the end yet

The USDJPY pair continues to fall. The Japanese yen has risen to new highs. Find out more in our analysis for 13 September 2024.

USDJPY forecast: key trading points

• The USDJPY pair declines rapidly
• The yen receives support from the Bank of Japan’s hawkish statements
• USDJPY forecast for 13 September 2024: 139.70 and 137.77

Fundamental analysis

The USDJPY rate fell to 140.99 on Friday, marking another annual low. This became possible due to the hawkish comments from a Bank of Japan member. Yesterday, Bank of Japan Policy Board member Naoki Tamura said that the regulator should raise short-term interest rates to 1.00% by fiscal 2026 to reach the inflation target of 2.00%.

This is not the only strong statement in recent days. Junko Nakagawa has previously noted that the Bank of Japan is ready to hike interest rates further. This will be relevant if the economy and inflation align with forecasts.

Rating agency Fitch revised its interest rate expectations. The borrowing cost is now projected at 0.50% by the end of 2024, 0.75% by the end of 2025, and 1.00% by the end of 2026.

The yen has benefited from the global weakening of the US dollar. The USDJPY forecast suggests further sell-offs in the pair.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[RoboForex Team]

GBPUSD continues to rise following a correction

Improving UK house price index and US manufacturing index figures support the British pound. Discover more in our analysis for 16 September 2024.

GBPUSD forecast: key trading points

• The Rightmove UK house price index (y/y): previously at -1.5%, currently at 0.8%
• NY Empire State Manufacturing Index (US): previously at -4.7 points, currently at -4.1
• GBPUSD forecast for 16 September 2024: 1.3177 and 1.3199

Fundamental analysis

A monthly change in the Rightmove UK year-over-year house price index was published on Monday, 16 September 2024. The indicator shows how much the average price of housing property for sale has changed. Figures above the forecast and previous data are a positive factor for the British pound. A weaker-than-expected reading reflects negative developments. The previous statistics came out below forecasts, while the current reading has now shifted to positive territory, reaching 0.8% and propelling the GBPUSD rate.

The NY Empire State Manufacturing Index measures the development of the manufacturing sector in New York State. It is calculated based on a survey of 200 largest manufacturing enterprises. A reading above zero points to increased manufacturing activity, while the one below zero indicates a decline. Stronger-than-expected data may provide significant support to the US dollar. The forecast for 16 September 2024 suggests that the reading will remain in negative territory at -4.1, which is still negative for the US dollar.

Fundamental analysis for 16 September 2024 does not provide arguments in favour of the US currency, so the pound sterling has every chance to continue its upward momentum after the correction.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team