The Yen is getting more expensive. Overview for 17.08.2020

USDJPY is falling on Monday morning; investors need “safe haven” assets.

The Yen is still rising against the USD and not responding to the weak statistics from Japan. The current quote for the instrument is 106.50.

The data published in the morning showed that the Japanese GDP lost 7.8% q/q in the second quarter of 2020 and that’s more than expected, -7.5% q/q. The country’s economy has been falling for the third consecutive quarter. For comparison, in the first quarter, the decline was -0.6% q/q. 

On YoY, the GDP plummeted by 27.8%. considering that the reading was seasonally adjusted, this is way too much. 

Japan continues supporting and stimulating its economy and has been keeping its interest rates negative for a long time. Amid global stimulus measures, the country is increasing its national debt but it’s not important right now as there are other crucial things. 

It is not beyond the reach of reason to suggest that the third quarter of 2020 will be quite tough as well. Not as dramatic as the second one but also very painful and minor.

The Yen hardly ever responds to the statistics and prefers to move based on market demand.