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At the Forex currency market the Japanese Yen rate continues to grow in the middle of the week: yesterday the Yen has reached postwar highs at 75.73 and then went above 76, returning below this level this morning. Investors continue to ignore the willingness of the Bank of Japan to conduct another intervention.

Forex forecast: MACD indicator for the pair USD/JPY is in the negative area, and started to decline, giving a sell signal. Stochastic Oscillator has come into oversold zone, shaping a similar signal.

Forex recommendations: in case of breakdown at the level of 75.85, the pair will go to 75.65 and 75.50. If downward breakdown does not take place, the pair will consolidate at the current levels.

A meeting, which has started today the Bank of Japan is going to touch a topic of intervention. The Yen increased by 6% this year, thus, forcing Government to take measures.

At the same time Japanese press gave information that the Bank of Japan is planning to discuss a chance of common intervention with the largest world’s regulators. We would remind that anti-inflation strategy is nearly ready in Japan; the country is prepared to announce additional infusion of 2 trillion yen to help companies-exporters which suffered from overvalued national currency. Another 2 trillion yen will be used in the employment sector.

Newly appointed Finance Minister of Japan Mr. Adzumi said that regulator is ready to take decisive measures if the JPY continues to grow, despite the fact that recent rise in the rate of the national currency is the result of speculations. At the same time the Bank of Japan is aware that dynamics of the Yen is based not on the fundamental data but only on the targets of speculators; therefore injections would need to be voluminous and cyclic.

From the fundamental point of view Japanese economy is stable as far as it is possible after the disaster in March. However, the impact of the expensive Yen can provoke resumption of talk about mitigation of fiscal conditions. At a two-day meeting last week the Bank of Japan left interest rate the level of 0.10% per annum, as expected. Regulator has commented that he is going to continue lending program until 30 April 2012. The Bank has refrained additional stimulation of the economy deciding to wait for the more complete results. Volume of assets purchase was maintained at 50 trillion yen. The head of the Bank of Japan Mr Shirakawa had confirmed this earlier when he said that it is necessary to monitor carefully the impact of the European debt crisis on the Japanese economy, including Forex market and commodity platforms.

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