Attention is turning to whether the franc-yen exchange rate can recover after falling due to a decline in industrial production

Attention is turning to whether the franc-yen exchange rate can recover after falling due to a decline in industrial production

20.05.2024

Last weekend, the U.S. dollar weakened against the pound after the U.S. April Leading Economic Index, released on the 17th, deteriorated to -0.6% from -0.3% the previous month. The GBP/USD pair rose from 1.2645 to 1.2711, breaking above the 20-period moving average (MA) on the hourly chart from below.On the 4-hour chart, the price has rebounded with the 20-period moving average acting as support, and on the daily chart, it has risen to the +3σ level of the Bollinger Bands, so we will be watching closely to see if the upward trend continues.

European currencies saw the Swiss franc weaken against the yen following the release of Switzerland’s first-quarter industrial production data, which deteriorated from the previous reading of -0.4% to -3.1%. The CHF/JPY pair fell from 171.815 to 171.177.The price fell from the +2σ to the -2σ levels on the hourly Bollinger Bands. Since the price failed to make a new high on the 4-hour chart and has since pulled back, we need to carefully assess whether prices will recover during European trading hours.

Today’s schedule includes the UK Rightmove House Price Index at 8:01, China’s Prime Lending Rate at 10:15, Thailand’s Real GDP at 11:30, Indonesia’s Current Account Balance at 12:00, Malaysia’s Trade Balance at 13:00, Japan’s Tertiary Industry Activity Index at 13:30, Taiwan’s Current Account Balance at 17:20,at 5:30 PM Hong Kong Employment Statistics, at 6:00 PM UK remarks by BOE Deputy Governor Brovent, at 8:30 PM US remarks by Bostic, President of the Atlanta Fed, at 10:00 PM US remarks by Fed Governor Waller, and at 11:30 PM US remarks by Fed Vice Chair Jefferson.We will be watching for a recovery in the CHF/JPY pair, which fell due to weaker industrial production data.