This EUR/USD Trade Is Nearly Complete, Is the USD/JPY Now Setting Up?

Economic data had its say during yesterday’s session, helping to push the major indices higher. Even though the major indices consolidated during the first few hours, optimists speculating that the U.S economy is now slowly crawling out of its current recession, continued to buy riskier assets, pushing the indices to new yearly highs. The S&P500 climbed during the later hours of the session, to close with a 1.53% gain, while the Nasdaq finished higher by 1.42%. The leader of the day was the financial sector, climbing by 1.97%.

On the data front, the U.S surprised during yesterday’s session as inflation figures showed that the economy is not in such a bad state. The CPI figure came out a tad higher than expected at 0.4%, while the Core figure showed a monthly change of 0.1%. The industrial production showed that the month of august was a positive month, climbing higher than expected at a rate of 0.8%. Both the figures together, encouraged analysts, showing them that while production is increasing, inflation still isn’t too much of a worry.

Yesterday’s higher market also had an effect on the VIX, also known as the fear index, dropping to its lowest level since September 2008. According to Bloomberg, the benchmark index for U.S stocks options slumped to its lowest its lowest intraday level in more than a year as global equities rallied on signs that the recession is over.
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