Here are the key factors to keep in mind today for Euro trades:

• German Import Price Index: Expectations call for a monthly increase of 0.2% in the German Import Price Index in May and an annualized contraction of 0.4%. Forex traders can compare this to the 0.6% increase which was reported in April and the annualized contraction of 0.6% year-year-over-year. Germany is the biggest economy in the Eurozone and is often used as a barometer for the Eurozone. The ECB is watching inflation reports carefully after implementing quantitative easing.
• Eurozone Money Supply (M3): Economists expect an increase of 5.1% for the three months which ended in May and an annualized increase of 5.4%. This can be compared to the 4.7% increase which was reported in the three months which ended in April and the year-over-year increase of 5.3% respectively.

Here are the key factors to keep in mind today for Japanese Yen trades:

• Japanese National CPI: Inflation in Japan slowed down as expected, but not as strong as feared. The National CPI posted an increase of 0.5% year-over-year in May. Economists expected a slowdown to 0.4% from the 0.6% reported in April. The National core CPI, which excludes food and energy, only rose by 0.1%. Expectations called for no change from the 0.4% increase which was reported in April. The National CPI excluding fresh food rose by 0.1%. Economists expected a flat reading which can be compared to the 0.3% increase which was reported in April. Japan has long struggled with creating inflation after its infamous bailout of its financial institutions in the late 90’s and hopes by the Bank of Japan to reach an inflation target of 2.0% seem out of reach. Deflationary risks outweigh any potential inflation due to the monetary policy by the Japanese central bank.
• Japanese Household Spending: Forex traders received good news on the Japanese consumer this morning. Household spending rose 4.8% in May year-over-year. This was better than the 3.6% increase expected by economists and can be compared to the 1.3% contraction reported in April. This was some rare good news on the Japanese consumer since the sales tax increase.
• Japanese Jobless Rate: The Japanese jobless rate remained unchanged at 3.3% in May as compared to April which was expected by economists. The job-to-applicant ratio rose to 1.19. Expectations called for no change from the 1.17 reported in April.

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