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The Japanese Yen rate remains in the offset channel at the Forex currency market; however it does not decline any longer.

Forex forecast: MACD indicator is in the positive area for the pair USD/JPY although it is still declining, preserving a pair sell signal. Stochastic Oscillator has come back to the oversold zone today and is giving a similar signal.

Forex recommendations: in case of breakdown at the level of 82.40 the pair will go to 82.30 and 82.10.

The situation in Japanese economy remains mostly unchanged. On 18 April the Bank of Japan started to repurchase government bonds from the market for the amount of Y160 billion which should support national economy.

It became known yesterday that surplus of trade balance amounted to Y196.5 billion in March against the level of Y931.94 billion a year earlier and tertiary index rose by 0.8% m/m in February against the fall by 0.1% in January - Japanese economy had really expanded but it was before the earthquake in March.

At the same time level of export decreased by 2.2% y/y in March, while level of import increased by 11.9% y/y which is logical..

Earlier statistics showed that the revised volume of industrial output in Japan rose by 1.8% m/m in February against the preliminary level of +0.9%. This is a mediate indicator for the Yen because it shows the situation prior to the earthquake in March. Statistics released this week showed that volume of orders for the basic production equipment in Japan reduced by 2.3% m/m in February for the first time in the last three months while a month earlier the index had increased by 4.2%. The indicator gives an idea about the amount of capital investments in production sector for the next 3-6 months. Thus, continuation of companies’ cost reduction threatens to the Japanese economy in addition to the fact that the situation in the business sector has already been very hard after the series of earthquakes and tsunamis.

Consolidation of the Yen this week reflected investors’ interest in safe currencies, caused by the situation with the USD, which was not very good. However, it is too early to speak about positive trend of the price.

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