The trading week is coming to an end with correction of the most currencies against the US dollar. However, the greenback will most likely close with a rise.
During the Asian session, the US dollar dropped to 123.95 following a three-day increase against the yen. However, ahead of the European session, it corrected and climbed to 124.25.
Traders' sentiment is mainly influenced by macroeconomic data. Disappointment caused by weak report on the US advance gross domestic product in the second quarter disillusioned too optimistic market participants. It became known that the US statistical services often change readings of macroeconomic indicators upwards intentionally, and after information is no longer relevant, they correct it with hindsight.
But the US monetary authorities' intention to raise the interest rate overshadows all other information. That is why, many currency analysts wait for resumption of growth in the US currency ahead of the September FOMC meeting.
Speaking of the Japanese economy, investors received news that boosted yen purchases. Last month, Japan's inflation rate remained at the level of May 2016.
According to the official data, inflation, excluding fresh food prices, made up 0.1% in June compared with the same month of the previous year. The report turned out to be quite predictable. Analysts didn't expect any changes in regard to May. Core inflation in Japan totaled 0.4% last month dropping from 0.5% in May. The consensus was a rise of 0.3% in consumer prices.
Hiroshi Nakaso, the Bank of Japan Deputy Governor, supposes that fall in crude prices, which will touch its peak in July to September, places downward pressure on the inflation. Inflation may accelerate in the fall 2015.
Consumer spending dropped unexpectedly. It will most likely impede the plans of the country's authorities to reach the targeted inflation level of 2%. Household spending fell by 2% on a yearly basis while the market expected a rise of 1.9%. In May, the reading grew by 4.8%. Besides, Japan's unemployment increased to 3.4% from 3.3% in May. Experts didn't anticipate any changes.