JPY: Japanese Yen continues to give way to USD

The Japanese Yen rate continuedto weaken at the Forex currency market on Friday and the JPY is losing ground,due to pressure from the USD.

Forex forecast: MACD indicatoris in the negative area for the pair USD/CHF, however is going up, and isshaping a buy signal. Stochastic Oscillator is going up in the neutral zone andis giving a similar signal.

Forex recommendations: in caseof breakdown at the level of 81.35, the pair will go to 81.50 and 81.65. If thepair happens to be weak, the target for the pair will be the level of 80.80.

Statistics released todayshowed that bank lending in Japan decreased by 0.6% y/y in June against theforecast of -0.5% y/y.

In addition, orders in themachine-building industry of Japan rose by 3.0% m/m in May against the fall of3.3% in April. According to the Cabinet “orders are recovering, howeversome sectors are lagging behind”. The indicator is usually considered asa leading index of corporate capital expenditures.

According to the data releasedearlier trade balance deficit in May (first 20 days) rose to Y1.053 trillionagainst the level of Y465 billion in April. It also became known that exportsvolume for the first 20 days in May totaled - 9.3% y/y versus the fall of-12.4% in April.

It became known earlier thatpreliminary index of leading indicators in Japan rose by +2.4% m/m in May whilethe forecast had been +2.5%. At the same time preliminary index of leadingindicators in may rose by 3.6 points versus the reduction of 3.4 points inApril. Indicator of delayed indices rose to 91.5 points (+0.7 points) in May.Based on statistics, authorities of Japan indicate that national economicsituation has improved.

The head of the Bank of JapanMr. Shirakawa said at the beginning of the week that economic growth of theCountry of the Rising Sun has faced powerful downward pressure. Nevertheless 7out of 9 regions of the country have revised their economic forecast upward.