On Thursday afternoon, the USD/JPY pair is growing as fast as yesterday, but is still in the black.
The Japanese Yen is slowly retreating on Thursday. Technically, the pair is moving close to the upside border of its short-term trading range. The current quote for the instrument is 113.48.
This morning, the Minister of Finance of Japan, Mr. Tarō Asō, appeared in public and noted that the country’s economic numbers are improving and there is no danger of deflation. However, it doesn’t mean that Japan won’t have any deflationary shocks if the Central Bank stops stimulating the economy. At the same time, the head of the department asked to pay attention to the upcoming increase of the sales tax, because it has to be done, and one should be ready for it even now. After the tax rate was raised in spring 2014, negative processes in the Japanese economy increased and the deflation could lead to the collapse of the system, but program of motivation was launched.
Duration of QE in Japan is not limited, the program of motivation will continue as long as the system needs. There is a serious risk that the national debt may increase, but possible scenarios to avoid this threat to the economy are not being developed, because the motivation program and soft monetary policy pay off.
Until the end of today’s trading session, the behavior of the Yen will depend on the US Dollar – the meeting of the European Central Bank will finish a bit later, and the markets are ready to react.
RoboForex Analytical Department
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