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At the Forex currency market the Japanese Yen rate stands still in the middle of the week after four days of steady growth.

Forex forecast: MACD indicator is in the negative area for the pair USD/JPY; it is moving sideways again and is not giving a clear signals. Stochastic Oscillator has come into oversold zone, and is giving a sell signal.

Forex recommendations: in case of breakdown at the level of 76.15, the pair will go to ? 76.10 and 76.80. Consolidation near the current levels is possible.

Most likely another round of strengthening in JPY will cause a flow of comments from monetary authorities of the country.

Meanwhile, morning news showed that average wages in Japan continues to decline: the data in December showed decline of 0.2% y/y, the same as in November. Therefore, Japanese wages have been declining for 8 months out of 12. 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 overall economic slump in the country.

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%.

At the same time, we cannot disregard the fact 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. 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.

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