Yen spikes against the US dollar after strong Japan data
The New Zealand dollar declined slightly after the latest trade numbers from the country. According to the statistics bureau, the country exported goods worth more than N$4.19 billion in January. This was relatively lower than the December exports of N$5.38 billion. In the same period, its imports declined from N$5.32 billion to N$4.83 billion. As a result, the country's total trade deficit rose to more than N$632 million. These numbers came after the relatively weak retail sales numbers and RBNZ interest rate decision.
The Japanese yen rose against the US dollar after the latest inflation data. According to the country's statistics bureau, the headline consumer price index declined by 0.3% in January, a better performance than the previous month's - 0.5%. The core CPI improved from - 0.4% to - 0.2%. While these numbers are below the BOJ estimate, they are heading in the right direction. The country's retail sales dropped by 2.4% while industrial production rose by 4.2%.
The economic calendar will have some key events later today. In the UK, Nationwide will deliver the latest house price index data. These numbers will provide an update about the payment performance of the housing market. In Germany, the statistics agency will publish the latest import price index while in France, the agency will publish flash inflation and GDP numbers. In Switzerland, SECO will publish the fourth quarter GDP numbers while in the United States, the Bureau of Statistics will release the latest personal income and spending numbers.
The EUR/USD broke-out yesterday and soared to a high of 1.2243. It then erased those gains during the American session and is now trading at 1.2170, which is slightly below the previous resistance level at 1.2180. On the four-hour chart, the price is slightly below the 23.6% Fibonacci retracement level. It is also slightly above the 25-day exponential moving average. Therefore, the pair may rebound in the near term as bulls target the resistance at 1.2200.
The USD/JPY pair declined from a high of 106.42 to a low of 105.84. On the hourly chart, this price has moved above the 23.6% Fibonacci retracement level. The pair also moved below the 25-day and 15-day exponential moving averages. The Relative Strength Index (RSI) has made a bearish divergence pattern while the price is slightly below the dots of the Parabolic SAR. The pair may continue falling as bears target the next support at $105.65.
The GBP/USD pair dropped sharply in the overnight session. It has moved from a multi-year high of 1.4240 to a low of 1.3950. On the hourly chart, this price is slightly below the ascending lower line of the ascending channel. It has also moved below the 25-day moving average while the signal and histogram of the MACD have moved below the neutral line. The pair may resume the downward trend to 1.3900.