Poor US data, slow vaccine distribution, rising virus cases worsened the market sentiment and underpinned safe-haven currencies like the USD, and JPY.
Japan's second quarter GDP is updated down on smaller capex profits
In the second quarter the Japanese economy ascended at a slower pace than initially assessed, on supposed downward revisions in capital spending surge, as a Reuters survey disclosed on Wednesday.
The world's number three economy is observed expanding at an annualized tempo of 2.9% in April-June, as the survey of 17 experts discovered that would be a considerable downward revision from the 4% surge observed in the preliminary data.
It would translate into 0.7% ascend from the previous quarter, updated down from an initial outcome of 1%, as the survey demonstrated.
Market participants expect the Japanese economy to keep reviving in July-September and even after.
Capital expenditure, a key component of GDP is supposed to have ascended 0.5% over the quarter, which is much slower compared to the 2.4% growth demonstrated in the preliminary data.
Japanese companies actually curbed their tempo of investment in plant as well as equipment in April-June, hinting the government might update down its initially upbeat estimate for economic surge in the second quarter.
The European Central Bank will publish the monetary policy statement with the interest rate decision on January 21, at 14:45 MT time.
Joe Biden is going to unveil a Covid-19 relief package of about $2 trillion. After this announcement, the 10-year Treasury yield rose, adding support for the USD.
The Canadian central bank will make a monetary policy report and announce interest rates on Wednesday, January 20, at 17:00 MT time. Also, the BOC press conference will be held later.
USD’s rally takes a pause, while riskier assets are modestly rising.
We are now past the middle of January, and this means that the largest US companies will report their earnings for the fourth quarter and many of them will provide the results of the entire 2020.