JPY Daily News

JPY Looks to Be Losing Momentum As It Starts the Week.

The Yen experienced bullish trends versus all of the major currencies during last week's trading session. The Yen gained about 150 pips against the USD, trading at slightly over the 107 level on Friday. Even bigger gains were seen against the EUR as the JPY gained more than 600 pips in a week with the pair's slide closing off the week under 107.20. Besides the notable bad economic data releases from most of the world, the JPY had a few indicators that sparked its own momentum. The low yielding currency has remained strong against its foreign counterparts after investors came to the conclusion that the European Central Bank will not increase interest rates anymore. As a result, foreigners buying Japanese goods are looking to buy Yen, which is helping to strengthen the Japanese currency. Although the Capital Spending release was worse than expected and the Japanese Prime Minister shockingly resigned last week, the JPY wasn't affected by this very much it had a few other supporting indicators. BoJ Governor Shirakawa held a speech around the same time, where he indicated that Japan's economy will return to a moderate growth path. The drop in crude oil price also led traders to expect a drop in transportation costs of Japanese goods exported across the world.


This week started with a continuation of bullishness for the JPY as the release of the M2 Money Stock on Sunday showed a better-than-expected figure; beating its forecast and last year's result. Look for more volatility this week as a fair amount of economic data will be released daily from Japan, with the most notable releases being: Quarterly Final GDP, Monthly Core Machinery Orders and Revised Industrial Production. Besides the Revised Industrial Production which is expected to stay at the same rate, the other two main figures are expected to be lower than their previous results. The question this week for the Yen will be whether traders will believe that the weak data that is expected to come out from Japan is part of the global effects from the American financial crisis and will soon be in Japan, or whether the JPY is having an economic slowdown not unlike what Shirakawa said last week, and is going to face a sharp fall. Traders should also keep tabs on the USD and EUR trends this week as they could continue to be very dominant factors in the Yen trends this week.

Current Time: 05/27 03:09 GMT

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#	Time	$€£¥	Event	Per.	Prev.	Fore.	Act.	Imp.
09/08
	06:00	JPY	Economy Watchers Current Index		29.3	29.7	28.3