JPY: Japanese Yen is getting weaker at the beginning of the week

At the Forex currency market the Japanese Yen rate goes down on Monday due to the pressure from the USD.

Forex forecast: MACD indicator for the pair has crossed signal line from top to bottom, indicating that a pair is in sale. Stochastic Oscillator is coming back to the oversold zone, and is not giving a clear signal yet.

Forex recommendations: in case of breakdown at the level of 81.60 the pair will go to 81.80 and further to 82.00. If upward breakdown does not take place, the pair will consolidate close to the current levels.

It became known last week, that the head of the Bank of Japan Mr. Shirakawa said that following the results of quarters I and II,  it can be expected that level of GDP will decline due to the serious aftermath of the earthquake in March. He thinks that the main problem is the shutdown of the production facilities, which in any way or other is connected with the power failure. Shirakawa believes that as soon as the power supply will reach the level of 11 March, production capacity will be restored. At the same time Central Bank is still ready to take measures to support economy, if required.

Japan also considers the possibility of raising taxes to 15% of the sales tax from the current 10%. It became known earlier that surplus of trade balance amounted to Y196.5 billion in March against the level of Y931.94 billion a year earlier; tertiary index rose by 0.8% m/m in February against the fall by 0.1% in January - Japanese economy had really expanded, at least before the earthquake in March. Meanwhile, the level of export decreased by 2.2% y/y in March, while level of import increased by 11.9% y/y which is logical.

Earlier the Bank of Japan declared that real GDP will rise by 0.6% this year against the forecast of growth by 1.6% in January.

As it became known earlier, the Bank of Japan has not changed interest rate, leaving it at the level of 0.1% per annum. Japanese data released after that was also mixed: unemployment rate remained at the previous level of 4.6% in March; preliminary data on industrial output fell by 15.3% m/m in March against the growth by 1.8% m/m in February; net CPI decreased by 0.1% y/y in march which became the 25th fact of reduction in a row; household spending decreased by 8.5% y/y in march against the previous decline by 0.2%.

 

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