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JPY: Japanese Yen was not allowed to continue its growth
At the Forex currency market the Japanese yen rate is traded downward on Tuesday. It is interesting that the Yen has weakened in pairing with the USD; while in pairing with other currencies the Japanese currency consolidated its positions due to ambiguous market.
Forex forecast: MACD indicator for the pair USD/JPY is in the positive area is moving along the signal line, not giving a clear signal. Oscillator is growing in the neutral zone and is shaping a weak signal to buy.
Forex recommendations: in case of breakdown at the level of 77.90, the pair will go to 78.00 and 78.20. If upward breakdown does not take place, the pair will consolidate at the current levels.
The data released this week showed that consumer confidence index in Japan fell for the first time in 7 months in November (38.1 against 38.6 previously), as global economy significantly affects Japan and its expensive Yen as well.
Real GDP in Japan was revised downward to +1.4% q/q (+5.6% y/y) in Q3 against preliminary +1.5% q/q (+6.0% y/y). New block of statistics showed that surplus of current account in Japan amounted to Y562.4 billion in October, demonstrating a fall of 62.4% y/y. Morning statistics also showed that volume of credit outstanding in the country increased by 0.2% y/y last month. It indicates the increase in demand for corporate financing and can be perceived positively. Level of bank lending is also growing steadily (+0.2% y/y in November: +0.1% y/y in October; -0.3% y/y in September).
The head of the Bank of Japan Mr. Shirakawa noted earlier that growth of the JPY continues to negatively impact on the local economy and that current rise of the JPY was provoked by European crisis. He believes that if appropriate measures are not taken straight away, economy of Japan will decline sharply by 2030. Mr. Shirakawa also noted that interventions against Yen are acceptable and effective. However, practical steps to support the words have not been made: apparently the Japanese regulator is in the “fly-through mode” presently moreover, the Yen does not give grounds for intervention due to its moderate activity.
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