On Friday, the USD/JPY pair is trading upwards expecting the news from Jackson Hole.
The Japanese Yen is falling against the USD at the end of the trading week. The current quote for the instrument is 109.63.
Today’s statistics from Japan showed that the Core Inflation Rate expanded up to 0.5% y/y in August, the same as expected. In July, the indicator was 0.4% y/y. In Tokyo, the Core CPI added 0.4% y/y, which is much better than both the previous reading and expectations.
The Core Inflation Rate excludes prices of fresh food, which are highly volatile. As a result, the indicator shows the number without changes of consumer sentiments.
The components of the report show that the fuel is getting more expensive faster than any other goods: in August, it rose by 4.3% y/y. The food prices added just 0.6% y/y over the same period. However, not all goods showed some positive numbers. For instance, the clothes prices lost 2.8% m/m and the furniture with interior objects are also getting cheaper.
Over the last several years, the inflation and its dynamics have been constantly stimulated by the Bank of Japan and the Japanese government. After 15 years of the deflation trend, the CPI’s entering a positive zone can be called a real success. However, the inflation target of the BoJ is 2% and it is still pretty far away.
The USD is being supported by expectations of the speeches to be delivered by the heads of the USA Fed and ECB this evening in Jackson Hole, Wyoming. Investors really hope to learn something new about further monetary actions to be made by the key Central Banks, but it’s very unlikely.
RoboForex Analytical Department