While the new year market in January has seen two weeks pass, what is visible is a trend of yen depreciation. On the other hand, the direction of the dollar exchange rate remains unclear even after the release of key indicators such as US employment statistics, US consumer price index, and producer price index.
The background of yen depreciation includes the view that the Bank of Japan’s timing for lifting negative interest rates has been pushed back due to the Noto Peninsula earthquake. In addition, it is also widely believed that funds are flowing overseas due to the start of the new NISA (Nippon Individual Savings Account) program. However, with regard to the new NISA, it seems to be in a festive start-dash mode. It will be necessary to watch carefully whether the overseas investment fever will continue in the future, while being cautious about the recoil and maintaining a steady stance.
Economic indicators to be released in the overseas markets later include the Eurozone industrial production index (November), Eurozone trade balance (November), Canada wholesale sales (November), and Canada manufacturing sales (November). These indicators may have a somewhat limited impact.
This week, on the 17th, US retail sales and industrial production, UK consumer price index, and other data are scheduled to be released, while on the 19th, US existing home sales and the University of Michigan consumer sentiment (preliminary) will be released, among others. Looking at the recent developments in the dollar exchange rate, it is uncertain whether the trend will become clear with this series of US indicators. Focus may shift to individual currencies, such as the UK inflation index.
Regarding speaking events, Robert Holzmann, Governor of the Austrian Central Bank, will participate in the Davos Conference discussion. Also, this week, US corporate earnings announcements will pick up. The earnings reports of financial giants such as Morgan Stanley and Goldman Sachs on the 16th are expected to be of particular interest. There are no high-profile corporate announcements scheduled for today. Today, the US stock and bond markets are closed due to Martin Luther King Jr. Day.”
The flow of the US dollar is expected to continue to be range-bound, with a trendless state continuing today.