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At the Forex currency market trading is still unstable for the Japanese Yen on Friday, as it lacks general direction.

Forex forecast: MACD indicator for the pair USD/JPY is in the negative area, and started to increase, giving a pair buy signal. Stochastic Oscillator is growing in the neutral zone, indicating moderate purchases.

Forex recommendations: in case of breakdown at the level of 81.70 the pair will go to 82.00 and 82.25. If upward breakdown does not take place, the pair will consolidate in the current range.

According to the decision of the Bank of Japan the key rate will be left unchanged in the range of 0-0.1%.

It is obvious that recession in the Japanese economy is preserved in full, however regulator still withholds from nullification of the rate.

The data released on Friday showed that activity index in the industrial sectors of Japan fell by 6.3% m/m in March; while the forecast of reduction was 6.1%. It became known this week that preliminary GDP in Japan fell by 0.9% q/q (-3.7% y/y) in QI against the expectations of decline by 0.5% q/q (-1.8% y/y). In addition, the revised volume of industrial production dropped by 15.5% in March against the previous level of -15.3%. It is clear that the earthquake in March had a negative impact on the industrial production. 

Japanese Economy Minister is confident that the economy of the Country of the Rising Sun is very easy to adapt to various changes and prior to the earthquake the state of economy had improved. “We are making progress in the fight against limited supply and by the end of this fiscal year GDP will increase by 1%” –he said. The Minister is also assured that economy can avoid recession.

It was made public earlier that consumer confidence fell to 33.1 points in April against the level of 38.6 points in March, at the same time index of CGPI rose by 0.9% ?/? in April against the growth by 0.6% m/m in March. According to the data released earlier, current account balance in Japan fell by 34.3%, to Y1.679 trillion in March against expected -32.0%. The data released earlier showed that leading indicators index decreased by 4.5% and index of coincident indicator subsided by 3.2%. In addition it is also became known that gold and foreign currency reserves of Japan have reached a new peak level.

Ex-deputy head of the Bank of Japan Mr. Muto said this morning that national economy is weak and will reach the bottom in QIII this year. Future economic prospects are vague. 

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