Good and bad signals | 19 8月 2021

19 8月 2021, USD/JPY

USDJPY trading plan:

If the Federal Reserve misreads the strength of future inflation in order to delay tightening monetary policy now it could require “very disruptive” and swift changes in policy down the road, St. Louis Federal Reserve president James Bullard said. Arguments in favor of a “go slow” approach to changing monetary policy are “a playbook from the aftermath of the global financial crisis,” less relevant to an economy with higher than expected inflation and likely fast job growth, Bullard said. “We could really get into trouble if we commit,” to a delayed exit from low interest rates and the current $120 billion in monthly bond purchases, he said. This is a positive signal for the dollar. Almost 60 percent of respondents anticipated the first reduction in the pace of net asset purchases to come in January, though, on average, respondents placed somewhat more weight than in the June surveys on the possibility of tapering. This is a negative signal for the dollar.

Investment idea: range 109.60 -100.50.

David Johnson
Analyst of «FreshForex» company
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