USDJPY Movement
For the 24 hours to 23:00 GMT, the USD strengthened 0.43% against the JPY and closed at 78.42. The Japanese Yen came under pressure amid warning signs that Bank of Japan could take further steps to weaken its currency.
The Japanese government has downgraded its assessment of the nation’s economy for the third consecutive month and indicated that the domestic economic recovery is weak recently due to deceleration in the global economy.
In the US, initial jobless claims for the week ended 6th October slumped to 339,000, a four-year low, compared to the previous week’s revised figure of 369,000. Meanwhile, in Japan, the seasonally adjusted basis, consumer confidence index fell to 40.1 in September, from 40.5 in August.
In the Asian session, at GMT0300, the pair is trading at 78.40, with the USD trading marginally lower from yesterday’s close.
This morning in Japan, on a seasonally adjusted basis, the tertiary industry index rose 0.4% (MoM) in August. Meanwhile, the M2 money stock increased 2.4% (YoY) to ¥819.1 trillion in September. Also, domestic corporate goods price index fell 1.4% (YoY) in September, in line with market forecasts and following the downwardly revised 1.9% contraction in August.
Meanwhile, Moody’s Investors Service has indicated that the political rift between Japan’s government and opposition parties is a concern and has stalled important legislation required to fund government spending.
The pair is expected to find support at 78.04, and a fall through could take it to the next support level of 77.67. The pair is expected to find its first resistance at 78.68, and a rise through could take it to the next resistance level of 78.95.
The currency pair is showing convergence with its 20 Hr moving average and is trading above its 50 Hr moving average.
