US Economic Calendar: Retail Sales and Fed Speakers

Later in the session, retail sales figures will likely influence buyer appetite for the USD/JPY.

Economists forecast retail sales to increase by 0.3% in May after stalling in April. Additionally, economists predict retail sales ex-autos to advance by 0.2% after an increase of 0.2% in April.

Higher-than-expected numbers could temper investor bets on a September Fed rate cut. Upward trends in consumer spending could fuel demand-driven inflationary pressures. A more hawkish Fed rate path may raise borrowing costs and reduce disposable income. Downward trends in disposable income could affect consumer spending and dampen demand-driven inflation.

Other stats include industrial production figures for May. However, the industrial production numbers will likely play second fiddle to the retail sales data.

Beyond the stats, investors should track FOMC Member speeches. Comments regarding inflation, the economic outlook, and the timing of a Fed rate cut could move the dial.

FOMC Members Thomas Barkin, Susan Collins, Adriana Kugler, Alberto Musalem, and Austan Goolsbee are on the calendar to deliver speeches.

Short-term Forecast

Near-term trends for the USD/JPY will depend on US retail sales figures, Bank of Japan chatter, and Fed speakers. An unexpected fall in US retail sales could shift monetary policy divergence toward the Japanese Yen before inflation and private sector PMI numbers on Friday.

USD/JPY Price Action

Daily Chart

The USD/JPY remained well above the 50-day and 200-day EMAs, confirming the bullish price trends.

A USD/JPY return to the 158 handle would support a move toward the 159 handle. Moreover, a USD/JPY breakout from 159 could give the bulls a run at the April 29 high of 160.209.

Investors should consider Bank of Japan commentary, US retail sales, and FOMC Member chatter.

Conversely, a USD/JPY fall below the 157 handle could signal a drop to the 50-day EMA. A break below the 50-day EMA could bring the 151.685 support level into view.

The 14-day RSI at 59.46 indicates a USD/JPY rise to the April 29 high of 160.209 before entering overbought territory.