01.03.2019

USD/JPY rallied from the support of the hourly Ichimuko cloud’s Senkou Span B (top of cloud) as the US GDP data hit the screens and beat expectations.  “US Q4 GDP was surprisingly resilient at 2.6% annualised (vs 2.2% expected), despite the steep slowing in activity implied by partial data especially in the month of December,” analysts at Westpac explained.  USD/JPY rallied from 110.74 to a high of 111.49 in North America trade from where it moved sideways into Tokoyo. Japanese traders are buying the pair and it is taking on fresh highs at the time of writing, printing 111.58 so far. The Nikkei also started out favourably with a spike to the upside. As for yields, the US 10yr treasury yield jumped from 2.66% to 2.72% overnight where they currently stay, while the 2yr yield jumped from 2.48% to 2.53%, following the release of Q4 GDP data.  Looking ahead For the day ahead, the analysts at Westpac note a fairly crowded Asian calendar: “Most attention will be on the Caixin China manufacturing PMI, which samples smaller firms than in the official PMI. Only a small improvement is expected from Jan’s weak 48.3 headline index.” For the US, the analysts explained that there are two important data releases: “The Dec reading on the Fed’s preferred inflation measure, the core PCE deflator, is seen holding steady at 1.9%, while the overall deflator edges down to 1.7%yr, mostly due to gasoline prices. The national Feb manufacturing ISM is expected to remain very firm, around 55.7, though down a little from Jan’s 56.6. The employment sub-index will help shape forecasts for Feb non-farm payrolls (8 March).” USD/JPY levels

Original from: www.fxstreet.com