Data shown Capacity Utilization in Japan was flat from last month and Industrial Production grew 0.5% in November were lower than previous hurt JPY yesterday. On the other hand, China released New Home Prices rose more than last month by 5.3% in 70 major cities year-on-year in December for the 27 straight months while Gross Domestic Production (GDP) in 2017 edged up 6.9% for the first time in seven years with Industrial Production and Retail Sales rose 6.2% an d 10.2% respectively from a year earlier in December added that Fixed Urban Investment increased 7.2% from a year earlier encouraged China’s Shanghai Composite Index closed up for the third straight day to more than two years high that pushed Asian stocks stuck record highs trimmed safe-haven demand in JPY, it helped USD/JPY to each 111.48 day high with 2-year U.S. Treasury yields jumped to the highest since 2008 supported USD.
However, USD was weighed as U.S. Federal Reserve (FED) officials said the U.S. economy should grow at good clip this year boosted tax cuts but they disagreed on rate hikes and U.S. President Donald Trump’s view of world trade that was aimed squarely at his America First stance would be challenged next week when he visits the World Economic Forum (WEF) at Davos judging by a paper seen by Reuters. Besides, economic research from Alliance Investment shown USD was overvalued around 10% and it expected USD would resume its weakness at the last six months after FED would hike interest rate twice at the first half of this year hurt USD. Moreover, weekly Initial Jobless Claims in U.S. decreased to 45-year low at 220,000 but both Building Permit and housing Starts in December decreased to 1.302 million and 1.192 million respectively with Philadelphia FED Business Index fell to plus 22.2 in January pressured USD. After U.S. lawmakers struggled to cobble together a federal budget deal prompted worries about a possible U.S. government shutdown, USD/JPY retreated to 110.68 day low. Forecast USD/JPY will be supported at 110.70-90 with resistance at 111.40-60 today.