News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bearish
Oil - US Crude
Bullish
Wall Street
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • Indices Update: As of 07:00, these are your best and worst performers based on the London trading schedule: US 500: 0.15% Wall Street: 0.07% FTSE 100: -0.27% France 40: -0.32% Germany 30: -0.38% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/YnjjB4v35p
  • 🇫🇷 Consumer Confidence (SEP) Actual: 95 Expected: 94 Previous: 95 https://www.dailyfx.com/economic-calendar#2020-09-29
  • An economic calendar is a resource that allows traders to learn about important economic information scheduled to be released. Stay up to date on the most important global economic data here: https://t.co/JdvW6HNuqV https://t.co/lBIEZWqJV3
  • Heads Up:🇫🇷 Consumer Confidence (SEP) due at 06:45 GMT (15min) Expected: 94 Previous: 94 https://www.dailyfx.com/economic-calendar#2020-09-29
  • EUR/JPY IG Client Sentiment: Our data shows traders are now net-long EUR/JPY for the first time since Aug 31, 2020 when EUR/JPY traded near 126.39. A contrarian view of crowd sentiment points to EUR/JPY weakness. https://www.dailyfx.com/sentiment https://t.co/1NGoTgKsbL
  • #CrudeOil and #Gold prices gained over the past 24 hours on US fiscal stimulus hopes Now they are awaiting a key meeting between Nancy Pelosi and Steven Mnuchin later today What are key technical levels to watch for? - https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/commodities/2020/09/29/Crude-Oil-Prices-Down-to-3-Month-Low-on-Fed-Policy-Seasonal-Turn.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/0nYq05le3s
  • Have you been catching on your @DailyFX podcast "Global Markets Decoded"? Catch up on them now, before new episodes release! https://t.co/Twr44cZ1GB https://t.co/kWoRBJxt7u
  • - $NZDUSD rates eyeing a retest of the September high after finding support at the 100-DMA. - Ascending Channel may guide $NZDJPY higher. - $GBPNZD poised to clamber back above the 200-DMA after carving out a Double Bottom reversal pattern. https://www.dailyfx.com/forex/technical/home/analysis/nzd-usd/2020/09/29/New-Zealand-Dollar-Analysis-NZDUSD-NZDJPY-GBPNZD-Price-Action.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Moss&utm_campaign=twr https://t.co/OvbsW1Jtb2
  • Heads Up:🇯🇵 Leading Economic Index Final (JUL) due at 05:00 GMT (15min) Expected: 86.9 Previous: 83.8 https://www.dailyfx.com/economic-calendar#2020-09-29
  • Heads Up:🇯🇵 Coincident Index Final (JUL) due at 05:00 GMT (15min) Expected: 76.2 Previous: 74.4 https://www.dailyfx.com/economic-calendar#2020-09-29
USD/JPY Higher As Japanese Economy Shows Inflation

USD/JPY Higher As Japanese Economy Shows Inflation

2013-07-26 01:00:00
Gregory Marks Jimmy Yang,
Share:

THE TAKEAWAY: Japan National CPI sees pick up in price trends > Offers some evidence that BoJ’s stimulus program may be working as intended > USD/JPY Edged higher

The Japanese Yen traded lower against the US dollar as Japan released data showing signs that the Bank of Japan’s massive easing program is actually working. June’s National CPI printed the first positive reading since May 2012 at 0.2 percent year over year to beat expectations for 0.1 percent. The core figures, which exclude food and energy, also beat expectations at -0.2 percent to show an improvement from the prior -0.4 percent reading.

This modest pickup in price trends offers some evidence that BoJ Governor Kuroda and Japanese Prime Minister Shinzo Abe’s economic and monetary policies are having their intended effect. Through buying 60 to 70 trililon yen in government bonds annually, the Bank of Japan hopes to achieve a 2% inflation target within the next two years. With Abe’s party winning a coalition majority in the July parliamentary elections, fiscal policy changes to rid the country of its enduring deflation and stagnant growth will likely begin in the coming months. Such measures could move JPY lower against USD. However, this round of improved data could put the BoJ in a position to revise its economic policy. The next monetary policy meeting is on August 7 and July minutes are scheduled for release on August 18.

The stakes are high for the Japanese economy; while inflation is much needed, it may have huge implications for the Japanese bond market. Indeed, 10-year government bond yields fell 1.45 percent after the CPI release but quickly recovered, which could indicate pressures against Japan’s public debt. Some estimate Japanese debt-to-GDP ratio is currently at 250 percent, an unsustainable debt load and the highest in the world.

With the highest debt to GDP ratio in the world, Japan must grow or face the music.

USDJPY_Higher_As_Japanese_Economy_Shows_Inflation_body_Picture_2.png, USD/JPY Higher As Japanese Economy Shows Inflation

Source: CIA World Factbook

Price action after the release corrected lower resulting in the pair remaining relatively flat at the start of the Asian session. Looking ahead, next week’s FOMC meeting will likely be highly influential for the pair. As investors weigh their expectations for monetary policy on the Federal Reserve’s rhetoric. Comments perceived to be dovish could move USD/JPY lower while any indications toward reducing its easing program could strengthen the pair. However, Board members are likely treading with caution ahead of the crucial NFPs release next Friday.

USD/JPY (5-Minute Chart)

USDJPY_Higher_As_Japanese_Economy_Shows_Inflation_body_Picture_1.png, USD/JPY Higher As Japanese Economy Shows Inflation

Source: FXCM Marketscope

Jimmy Yang, DailyFX Research Team

Gregory Marks, DailyFX Research Team

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES