USD Holds Stable in Anticipation of Busy Week

Forex News

The US dollar is trading in a narrow range today, as traders expect key meetings of central banks this week. The two-day meeting of the Bank of Japan will end on Tuesday. The meeting of the Fed will take place on Tuesday and Wednesday, and the Bank of England will take a political decision on Thursday.

The dollar index against the basket of the six major currencies was almost unchanged at 94.47 after a slight decline on Friday. Data on the US Q2 GDP could not raise the dollar, although it proved to be strong, did not justify the average market forecasts. US second-quarter GDP grew at 4.1%, marking the quickest pace of growth since 2014.

It is expected, that the Bank of Japan will discuss an adjustment to its JGB target rates and possibly scaling back its investments in ETFs that track the Nikkei. Analysts are unanimous in their view that there will be no change in rates, with the possibility of allowing the 10-year JGB yield to move above zero percent, which is its current target level. The 10-year yield is trading at 0.11% today and notably has held above 0% since September last year.

According to the Japan’s Ministry of Commerce, retail sales rose by 1.8% yoy in June after rising by 0.6% in May. Economists predicted an increase of 1.6%. The results for June showed that retail sales increased eight months in a row.