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
Subscribe
Please try again
EUR/USD
Bearish
Oil - US Crude
Bullish
Wall Street
Bearish
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Bullish
More View more
Real Time News
  • The recent surge in the Treasury market has pushed the benchmark 10Y yield back above the S&P 500 dividend yield https://t.co/x28BFkmjNv
  • S&P 500 on the verge of getting separation from March trend-line. Nasdaq 100 below March trend-line, triggering H&S pattern. Get your #equities market update from @PaulRobinsonFX here:https://t.co/quhMgBpoiq https://t.co/n0jtTnVNwl
  • Japanese Gov't recommends 2-week extension of Tokyo virus emergency - BBG $JPY
  • While the rise in yields is weighing on risk trends, carry trade didn't seem to take the hit. In fact, the charge in US yields seems to have far outweighed the de-risking from $USDJPY's perspective: https://t.co/KpOpgopOep
  • Forex Update: As of 21:00, these are your best and worst performers based on the London trading schedule: 🇨🇦CAD: -0.09% 🇬🇧GBP: -0.40% 🇦🇺AUD: -0.69% 🇳🇿NZD: -0.81% 🇯🇵JPY: -0.90% 🇨🇭CHF: -0.97% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/8Tvotykz9y
  • Commodities Update: As of 21:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 0.33% Gold: -0.69% Silver: -2.64% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/faJTbi16VK
  • AUD/USD now off daily lows, remains much weaker as a result of broad US Dollar strength $AUDUSD https://t.co/OkdKWbepAR
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Silver are long at 93.13%, while traders in GBP/JPY are at opposite extremes with 70.14%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/XXOjh5LmaB
  • Silver price action stalls between Moving Averages. Platinum prices currently confined by Fibonacci Support. Get your market update from @Tams707 here:https://t.co/Nbl8FDmfps https://t.co/VyuZzP8w2q
  • US Markets at the Close $NDX 12464.0 -1.73% $SPX 3768.49 -1.34% $DJI 30924.14 -1.11%
Japanese Yen Holds On Despite Huge 4Q GDP Plunge

Japanese Yen Holds On Despite Huge 4Q GDP Plunge

David Cottle, Analyst

Japanese Yen, Japan Gross Domestic Product Data, Talking Points:

  • Japan GDP growth took a big hit as 2020 bowed out
  • The statistics agency points at typhoon impacts and the imposition of higher sales tax
  • However economists will worry that Japan was ill-prepared economically for coronavirus

The Japanese Yen moved very little on Monday despite news of a big fall in growth for its home country, well ahead of expectations. This relative torpor is probably explained by the fact that monetary policy is already ultra-loose in Japan and likely to stay that way irrespective of the data.

Official Gross Domestic Product for the final calendar quarter of 2019 fell by a huge 6.3%, annualized and seasonally adjusted, nearly double the 3.8% slide expected and massively below the 1.8% rise seen in the third quarter. This is the worst showing for this series since 2014.

The seasonally adjusted quarterly fall was 1.6%, worse than the 1% slide expected. Private consumption and business spending were both sharply lower.

The Japanese statistics agency cited both the impact of typhoons and the imposition of sales tax as reasons for this woeful performance but market watchers are likely to be very concerned at the underperformance which has come in the very months before coronavirus hit.

Still, the Bank of Japan is already committed to extraordinary stimulus until inflation hits 2% and stays there. These data only underline how difficult that task will be, but the Yen has long done without the sort of data impact other currencies see as the link between the numbers and the policy response has been effectively cut.

US Dollar vs Japanese Yen, 5-Minute Chart
USD/JPY BULLISH
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily -15% 2% -6%
Weekly -26% 36% -1%
What does it mean for price action?
Get My Guide

Both the Japanese Yen and the US Dollar have seen considerable bids as investors worried about the coronavirus’ economic impact seek haven assets.

As USD/JPY’s daily chart shows the US Dollar has been winning this ‘battle of the havens,’ with its 2020 uptrend still in place. However the greenback seems to be running out of steam short of January’s highs, but the long-term downtrend from 2015 remains very much in Dollar bulls sights.

US Dollar Vs Japanese Yen, DailY Chart

On pure interest-rate comparison alone there would seem very little reason to favor the Yen, especially with such weak Japanese data suggesting that it will carry miserly returns for the foreseeable future.

Japanese Yen Resources for Traders

Whether you’re new to trading or an old hand DailyFX has plenty of resources to help you. There’s our trading sentiment indicator which shows you live how IG clients are positioned right now. We also hold educational and analytical webinars and offer trading guides, with one specifically aimed at those new to foreign exchange markets. There’s also a Bitcoin guide. Be sure to make the most of them all. They were written by our seasoned trading experts and they’re all free.

--- Written by David Cottle, DailyFX Research

Follow David on Twitter@DavidCottleFX or use the Comments section below to get in touch!

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

DISCLOSURES