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At the Forex currency market the Japanese Yen rate continues to grow fast, exploiting weak economic performance in Japan.

Forex forecast: MACD indicator is in the negative area for the pair USD/JPY; it started reversal, going down slightly and giving a sell signal. Stochastic Oscillator has come into oversold zone, giving a similar signal.

Forex recommendations: in case of breakdown at the level of 76.20, the pair will go to ? 76.10 and 76.80. Consolidation near the current levels is possible.

It became known today that unemployment rate in Japan rose to 4.6% in December against the level of 4.5% in November. At the same time, the level of unemployed decreased by 100 thousand against the growth of 80 thousand a month earlier. Nevertheless, this data has not radically affected general trend. Labour sector has been strongly affected by the over all economic slump in the country.

Now, economic stimulus programs for the total amount of 20 trillion yen, are being implemented in Japan. They were designed to increase demand and finalize work to eliminate aftermaths of tsunami and earthquake in March. These funds shall also revive employment sector.

There has been some other positive data- preliminary volumes of industrial output rose by 4.0% m/m in December against expectations of growth of 2.7%.

According to the data released yesterday morning, trade balance in Japan amounted to -Y916.2 billion in the first ten days of January. Volume of export was at the level of -20.7% y/y, import rose by 24.3% y/y. It became known earlier that trade deficit has been recorded in Japan for the first time in 30 years. Exports in the country fell in December for the third time, which triggered trade deficit on annual basis. According to the Ministry of Finance, shipments reduced by 8% y/y last month. Budget deficit in Japan amounted to $32 billion (2.49 trillion yen). It seems that Japanese economy has been deprived of one of the main supportive tools - its exports.

It became known earlier that retail sales increased by 2.5% y/y in December against decline of 2.2% in November. These findings are extremely interesting because they demonstrate that, despite significant slump in economy, retail sales can be in favourable position. The latest data was the strongest one over the last six months; apparently, consumers' optimism and appetite for buying is back again. At the same time, we cannot disregard the fact that, due to continuing decline of export levels and losses in the manufacturing sector, income of Japanese people will decrease as well, and this will inevitable affect retail sector.

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