The Yen is under pressure. Overview for 25.03.2016
25.03.2016
The USD/JPY pair continue growing on the “thin” market; the statistics published this morning turned out to be quite unclear.
The Japanese Yen is still under pressure from the US Dollar. The current quote for the instrument is 112.97 as it is clearly moving towards 114.0.
The morning statistics showed that the inflation in Japan on a year-on-year basis hasn’t changed in February. The core inflation in the country is 0.3% y/y against the predicted number of zero. Too low commodity prices are slowing down the CPI and the weak domestic consumption.
Such nuance as unequal inflation may be the reason, which influences the entire monetary policy of the BoJ. The QE was expanded, negative rates were introduced, but the consumption wouldn’t increase. This is a problem, which was impossible to foresee “on shore”. But is has to be solved by all means.
Consumers spend money when they are confident about perspectives and future. It appears that the BoJ and the Japanese government must assure people that there won’t be any tension in the economy, but right now no one would guarantee such things.
In addition to that, the Yen is being under pressure from the strong US Dollar, which is becoming more expensive because of the talks that the interest rate in the USA might increase soon. There aren’t too many “catalysts” on the “thin” market, but this one works efficiently.
RoboForex Analytical Department
The Japanese Yen is still under pressure from the US Dollar. The current quote for the instrument is 112.97 as it is clearly moving towards 114.0.
The morning statistics showed that the inflation in Japan on a year-on-year basis hasn’t changed in February. The core inflation in the country is 0.3% y/y against the predicted number of zero. Too low commodity prices are slowing down the CPI and the weak domestic consumption.
Such nuance as unequal inflation may be the reason, which influences the entire monetary policy of the BoJ. The QE was expanded, negative rates were introduced, but the consumption wouldn’t increase. This is a problem, which was impossible to foresee “on shore”. But is has to be solved by all means.
Consumers spend money when they are confident about perspectives and future. It appears that the BoJ and the Japanese government must assure people that there won’t be any tension in the economy, but right now no one would guarantee such things.
In addition to that, the Yen is being under pressure from the strong US Dollar, which is becoming more expensive because of the talks that the interest rate in the USA might increase soon. There aren’t too many “catalysts” on the “thin” market, but this one works efficiently.
RoboForex Analytical Department
Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.