2m 35s: Lenght

Since the early session on Monday, the US dollar is extending its winning streak. Investors are still taking into account Donald Trump’s election victory. Trump’s election program includes a number of fiscal incentives and reduction of taxes. It shall have a beneficial effect on the US economy: GDP growth will accelerate, and the inflation will eventually rise up to 2%, or even higher. Of course, under such conditions, the Federal Reserve has to adjust its monetary policy for the current economic trends and increase the interest rate. The policy differential between the US Fed on the one hand and the ECB and the Bank of Japan on the other hand enables the US dollar to advance against the yen and euro. In the Asian trade today, the dollar/yen pair hit 111.00, the highest level since May 31. The pair is consolidating next to this level in the European session. Technical indicators signal the pair is to trade sideways in the nearest couple of days. The yen was able to reach the level of 111 against the US dollar in light of Japan’s trade balance report. According to Japan’s ministry of finance, the gap between exports and imports again contracted to about 496.2 billion yens in October. The trade surplus came in better than expected as analysts had assumed the proficit at 404.3 billion yens. Nevertheless, the market is discouraged with the balance of trade. The devil is in the detail. Japan’s economy focuses on foreign trade performance. Meanwhile, the country’s exports fell in October for a 13th month in a row and by more than expected. According to the government data, export sales dropped 10.3% on a yearly basis. The October data is much weaker than an 8.6% drop expected by economists. Besides, imports are also in decline. Last month, Japan’s imports shrank 16.5% falling short of market expectations. Analysts had expected imports to fall at the same pace as in September. https://www.instaforex.com