USDJPY Movement
For the 24 hours to 23:00 GMT, the USD weakened 0.76% against the JPY and closed at 108.00.
On the macro front, Japan’s leading economic index dropped to 104.0 in August, marking its lowest level since January 2013 and compared to a reading of 105.4 registered in the prior month. Meanwhile, the nation’s coincident index came in at 108.5 in August, lower than market expectations of a fall to a level of 108.6. The index had registered a reading of 109.9 in July.
Separately, the BoJ at its latest monthly monetary policy meeting revised down its assessment of the nation’s factory output, citing that though Japan’s economy continues to recover moderately, but there still remains weakness in production after the sales tax hike in April.
Yesterday, the IMF slashed its growth projections for Japan by almost half to 0.9% this year, as compared to 1.6% growth expectation in July. Additionally, it further reduced its growth forecast for the next year to 0.8% from its earlier projection of 1.0%.
In the Asian session, at GMT0300, the pair is trading at 108.34, with the USD trading 0.31% higher from yesterday’s close.
Early morning data indicated that, Japan’s trade deficit widened to ¥831.8 billion in August, compared to market expectations of a deficit of ¥770.7 billion and following a deficit of ¥828.1 billion in the prior month.
The pair is expected to find support at 107.64, and a fall through could take it to the next support level of 106.94. The pair is expected to find its first resistance at 109.14, and a rise through could take it to the next resistance level of 109.95.Trading trends in the Yen today would be governed by Japan’s economy watcher’s survey data.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
