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At the Forex currency market the Japanese Yen rate is traded upward on Monday after two days of correction. Demand for the currency is increasing as external background remains tense and investors need to hedge their positions in the “safe harbor.”

Forex forecast: MACD indicator is in the negative area for the pair USD/JPY, and is moving along the signal line now, not giving a clear signal. Stochastic Oscillator has come out of the oversold zone and is giving a buy signal, going upward.

Forex recommendations: in case of breakdown at the level of 77.00, the pair will go to 77.10 and 77.35.

If upward breakdown does not take place, the pair will go to 76.30. Recent correction in the pair slightly reduced risks of a new round of currency intervention from the Bank of Japan.

However, looking at the latest dynamics of the pair a thought that regulator is involved in trades does not seem too weird.It became known earlier that revised industrial production in July increased by 0.4% m/m versus preliminary level of +0.6% m/m; which is quite natural because slump, which is evident in the economy, was caused by slowdown in the global economy.

According to the previous estimates of the Bank of Japan, real level of GDP will rise by 0.4% in the fiscal year of 2011 (forecast of April had been more optimistic: +0.6%). In the fiscal year of 2012, GDP growth is expected in the volume of 2.9% which would agree with the April forecast. Next year CPI is predicted to be at the level of +0.7%. Real GDP in Japan decreased by 0.2% on quarterly basis (-1.3% y/y) in Q2.

GDP fell less than expected, and Minister of Finance of the Country of the Rising Sun said that next quarter Japan will demonstrate the rise of economy.According to the data released earlier revised industrial output in July rose by 0.4% m/m. Statistics released earlier showed that real revised GDP in Japan fell by 0.5% q/q (-2.1% y/y) in Q2 against the forecast of -0.5% q/q (-2.0% y/y) and previous level of -0.3% q/q.

Statistics released yesterday showed that bank lending fell by 0.5% in August against the decline of 0.6% in July. In addition, index of economical observers who monitor current situation fell to 47.3 points in August against the level of 52.6 points in July.

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