Forex Analytics from LiteForex of 05.11.10: JPY: Japanese Yen continues to grow on Friday

The Japanese Yen rate continues to grow at the Forex currency market on Friday.

Forex forecast: MACD indicator is in the negative area for the pair USD/JPY and it goes down conforming a previous sell signal for the pair. Stochastic Oscillator is giving a pair buy signal being in the oversold zone.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 81.00 the pair will go to 81.40 and 81.90. In case of breakdown at the level fo80.60, traders’ targets will become the levels of 80.20 and 80.00.

The Bank of Japan announced that the interest rate will be maintained in the target range of 0-0.1% per annum; the head of the Bank Shirakawa stressed that the regulator is not going to compete with the FR in the issues of the monetary policy easing. He noted that the Japan does not have any serious financial imbalances; he also noticed that the regulator will closely monitor the effects of the assets redemption program. At the meeting which ended today the Bank of Japan considered the issue of buying mortgage investments trusts with the rating not lower than AA. In addition the Bank will purchase stock exchange funds of the Nikkei 225 Stock Average and Topix indices.

Meanwhile, as it was noted earlier the Bank of Japan expects that Japanese economy will be back on the path of the moderate growth in 2011 while basic inflation average forecast still amounts to 0.4%. Average forecast of the actual GDP level for the next fiscal year is at the level of +2.1% against the forecast of 2.6% in July. The head of the Bank Shirakawa noted that monetary policy easing will be carried more active than before as the economy proceeds along the course of recovery.

As the data showed on Monday, average basic salary in Japan increased by 0.1% y/y in September against the previous decline by 0.2% which became the first growth factor over the last 25 months.

Japanese Finance Minister Mr. Noda noted earlier that currency market movement has a negative impact on the risks in economy as well as the concerns regarding external economy state. In his view, Japanese economy is stagnating now and its growth will be resumed only in case of the appropriate policy. He also stressed that authorities take all efforts to fight deflation.





 

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