JPY: Japanese Yen has reduced its activity today

At the Forex currency market the Japanese Yen rate has reduced its activity at the beginning of the week. Probably it is positive external background and rebound in the world financial institutions that caused the decrease in interest to the safe currency.

Forex forecast: MACD indicator is in the negative area for the pair USD/JPY, and is going up, giving a buy signal. Stochastic Oscillator goes down in the neutral zone and is giving a sell signal.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 76.60, the pair will go to 76.30 and 76.10. If downward breakdown does not take place, the pair will consolidate at the current levels.

Markets of Japan are closed today due to celebration of the Sport and Health Day.

Statistics released earlier showed that real revised GDP in Japan fell by 0.5% q/q (-2.1% y/y) in Q2 against the forecast of -0.5% q/q (-2.0% y/y) and previous level of -0.3% q/q. The data released at the end of the last week included the following information about inflation: base national CPI amounted to +0.2% y/y in August. In addition, it also became known that unemployment fell to 4.3% in August against the forecast of 4.7% and previous level of 4.7%.

Business survey Tankan published this week showed that expectations of the large industrial enterprises amounted to +2 points in September against the forecast of +3 points. Expectations of large non-industrial enterprises demonstrated decline of 11 points versus the forecast of -14 points and -21 points previously. At a two-day meeting of the Bank of Japan last week interest rate was left at the level of 0.10% per annum, as expected. Regulator said in the comments that he is going to continue lending program until 30 April 2012. The Bank has refrained additional stimulation of the economy deciding to wait for the more complete results. Volume of assets purchase was maintained at 50 trillion yen.

From the fundamental point of view Japanese economy is stable as far as it is possible after the disaster in March. However, the impact of the expensive Yen can provoke resumption of talk about mitigation of fiscal conditions.