Yen suddenly gained momentum. (Credit : Forex)

US dollar is considered overpriced, Japanese Yen strengthens

Siti Fatimah Adri
Politics & Economic
News Flash Japan
Jul 18, 2019
1800
Although the Yen's performance on Wednesday's trading (7/17) cannot be said to be good, this morning Yen suddenly gained momentum. According to CNBC International, this strengthening occurs after the International Monetary Fund (IMF) said that the current dollar exchange rate, based on current fundamentals, is overvalued 6% to 12%.

Reported from refinitive data, Yen which traded in Spot Market rose 0.23% or in the range of 107.67 / US$. The fall in the value of the dollar not only affects the Yen, but also other major currencies such as the Euro and Pound.

Actually, Dollar was in a good strengthening momentum due to the release of slick US retail sales data last week. This even made the greenback's strengthen compared to Yen for two consecutive days. Before finally being declared expensive by IMF. Last Tuesday (16/7), US Department of Commerce reported that core retail sales and retail sales data (excluding the automotive sector in calculations) rose by 0.4% month-on-month, higher than predictions at each Forex Factory -one 0.1%. This retail sales data is a component that contributes around 68% of gross domestic product (GDP). The high retail sales are expected to be positive for US GDP in April-June period.

Unfortunately, although data from US is still positive, Governor of the US central bank (The Fed) Jerome Powell continues to state that he didn't change his desire to cut interest rates at the end of this month.

Source: https://www.cnbcindonesia.com/market/20190718091503-17-85756/imf-sebut-dolar-as-kemahalan-yen-langsung-unjuk-gigi