USD/JPY Fundamental Analysis February 21, 2012, Forecast

Economic Events: GMT: + 10:00

10:30     AUD      Monetary Policy Meeting Minutes

The Reserve Bank of Australia (RBA) Monetary Policy Meeting Minutes are a detailed record of the bank’s most recent policy-setting meeting, containing in-depth insights into the economic conditions that influenced the rate decision.

More dovish than expected minutes could be taken as negative/bearish for the AUD, while more hawkish than expected minutes could be taken as positive/bullish for the AUD.                                                                

12:00     NZD       Inflation Expectations (QoQ)                                                                    2.8%

Inflation Expectations measures the percentage that business managers expect the price of goods and services to change annually during the next two years. The data is released quarterly.

A higher than expected reading should be taken as positive/bullish for the NZD, while a lower than expected reading should be taken as negative/bearish for the NZD.                          

12:30     AUD       RBA Governor Stevens Speaks                  

Reserve Bank of Australia (RBA) Governor Glenn Stevens (September 2006 – September 2013) is to speak. As the head of the RBA, which sets short term interest rates, he has a major influence over the value of the Australian dollar. Traders watch his speeches closely as they are often used to drop subtle hints regarding future monetary policy and interest rate shifts.

His comments may determine a short-term positive or negative trend.

Analysis and Recommendation: ( close of Asian session )

USD/JPY was trading at 79.53. The USD fell on news from China and Greece. The Yen had a positive move after the decision by the Chinese central bank to lower the ratio of funds that commercial banks must hold as reserves. The cut, which will free up more money for commercial banks to lend, is aimed at helping to improve economic growth. Injecting the equivalent of billions of dollars into the economy, which will boost demand for goods and services in New Zealand and elsewhere in Asia and the Pacific.

Investors are hopeful European finance ministers will approve Greece’s $US130 billion bailout package at a meeting in Brussels on Monday. Italian Prime Minster Mario Monti, German Chancellor Angela Merkel and Greek Prime Minister Lucas Papademos have all expressed optimism that an agreement on Greece can be reached.

Data released today showed that Japan’s trade deficit widened significantly in January to ¥1.475 trillion ($18.5 billion), its largest on record. The weaker currency helped Japanese exporters add to gains made last week after the Bank of Japan’s unexpected expansion of its asset-buying program.

Monday February 20, 2012 Economic Data actual v forecast

US markets closed



PPI Input (QoQ) 









Trade Balance 








Sovereign Bond Auction Schedule

Feb 20-24 n/a  UK  0.375% 2062 I/L Gilt syndication

Feb 20  10:10  Norway  Nok 3bn 4.5% May 2019 DSL

Feb 20  10:10  Slovakia  Eur 0.15bn Apr 2014 & Eur 0.05bn Nov 2016 bonds

Feb 21  09:30  Spain  3 & 6M T-bill auction

Feb 21  15:30  UK  Details gilt auction on Mar 01

Feb 21  18:00  US  Auctions 2Y Notes

Feb 22  10:10  Sweden  Nominal bond auction

Feb 22  10:30  Germany  Eur 5.0bn Mar 2014 Schatz

Feb 22  16:30  Italy   Details CTZ/BTPei on Feb 24 & BOT on Feb 27

Feb 22  18:00  US  Auctions 5Y Notes

Feb 23  10:10  Sweden  Sek 0.75bn I/L bond auction

Feb 23  16:30  Italy   Details BTP/CCTeu on Feb 28

Feb 23  18:00  US  Auctions 7Y Notes

Feb 24  10:10  Italy   Auctions CTZ/BTP

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