Should we keep an eye on the upside potential of the Canadian dollar against the yen, which has risen on the back of improved manufacturing sales?
16.01.2024
- Germany's Consumer Price Index
- U.S. New York Fed Manufacturing Index
In yesterday’s U.S. currency trading, the Canadian dollar rose against the yen after Canada’s November manufacturing sales, released yesterday, improved to +1.2% from -2.8% the previous month. The CAD/JPY pair rose from 107.856 to 108.757.It temporarily broke above the 20-period moving average (MA) on the hourly chart. On the 4-hour chart, CAD/JPY is showing a rebound supported by the 75-period MA, so we will be watching to see if the Canadian dollar continues to strengthen through the middle of the week.
Despite the improvement in Germany’s December wholesale price index—which was released yesterday and showed a year-over-year decline of 2.6% compared to the previous month’s 3.6% drop—the euro fell against the U.S. dollar. The EUR/USD pair fell from 1.0967 to 1.0933, dropping to the -3σ level of the hourly Bollinger Bands.The EUR/USD pair has continued to decline during today’s Asian session, already dropping to 1.0915. We will closely monitor whether the euro continues to weaken.
Today’s economic indicators include UK employment figures and the German Consumer Price Index at 4:00 PM, the German ZEW Economic Sentiment Index and the Eurozone ZEW Economic Sentiment Index at 7:00 PM, and Israel’s real GDP at 8:00 PM.at 10:15 PM: Canadian housing starts and CPI, and the New York Fed Manufacturing Index; at 12:00 AM: remarks by Bank of England Governor Bailey; and at 1:00 AM: remarks by Federal Reserve Governor Waller. We will be watching for further upside potential in the CAD/JPY pair, which has risen on the back of improved manufacturing sales.
Author: Keisuke Sakurai
