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The last day of this week opened with  Bank of Japan Governor Masaaki Shirakawa speech. He said that the BOJ sees the economy struggling, and that they may respond in purchasing corporate debt.  Cut rates are not an option, considering Japan’s 0.1% interest rate. USD/JPY now trades above 90, at 90.34.

Elsewhere, the dollar loses ground this morning to the British Pound. GBP/USD now at 1.4923. Also the Euro is enjoying gains against the dollar. EUR/USD at 1.3233.

In Switzerland, the monthly PPI fell by 0.7%, a little worse than expectations.  

In Britain,  BOE Deputy Governor Sir John Gieve told reporters that the British economy will suffer it’s worst downturn in decades. GDP for the last quarter of 2008 and the first quarter of 2009 is expected to be terrible in the UK, and that a avoiding a prolonged recession is the BoE’s goal. He also stated that a fall in the pound is helpful for the economy.

An important release is the Core CPI in the US. It’s expected to be at 0.1%, with the CPI dropping by 0.8%, due to falling oil prices. Due to the dire state of the world’s economies, inflation isn’t a threat, making this figure less important than in previous months.

Later on,  the  TIC Long-Term Purchases will be closely watched by economists as well as Forex traders.  

At 14:55 GMT, the University of Michigan will publish the Consumer Sentiment. The  Prelim UoM Consumer Sentiment  considered a very important indicator. The number is expected to be positive, above 50, at 59.2. This is the main release of the day.

More in the US:  Prelim UoM Inflation Expectations,  Capacity Utilization Rate and the monthly  Industrial Production which is expected to fall by 0.9%.

When the forex market will already begin unwinding towards the weekend,  Federal Reserve Bank of Richmond President Jeffrey Lacker will talk about the financial markets.

Happy Forex Trading and a great weekend!

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