THE TAKEAWAY: Japan trade exports decline, deficit narrows > Poor figures confirm BoJ view of weakening economy, stimulus supportive > USDJPY traded higher
The Yen declined versus the Dollar as Japanese exports declined 6.5 percent, year-over-year, in October while imports declined 1.6 percent over the same period. The trade deficit narrowed to 549 billion yen in October from 561.7 billion in September as the rate of export contraction slowed while imports also declined effectively reducing the deficit.
The poor trade figures print just one day after the BoJ held their monetary policy meeting where a weakening economy was cited as a primary concern. Forex traders may find little reason to buy the low yielding currency as policy officials have pledged to pursue aggressive monetary easing which could effectively debase the yen’s value.
USD/JPY, 1 Minute Chart