In the June economic assessment report, the Japanese government maintained its general view of the economy but lowered its output forecast. Unsurprisingly this news caused a 7% pump in the Forex live chart USD/JPY.
Key messages for the USD/JPY Forex trading chart
- The Japanese government cut its output report for the first time in seven months.
- The government said production growth appeared to have stalled.
- Upgraded imports from the previous month, saying imports have stopped falling as the sharp decline in shipments from China appears to have slowed.
- Gave a more favorable view of housing investment to improve rental housing.
- Forex correlation USD/JPY to the mark of 126 is officially over.
USD/JPY Forex live situation
Against the background of the growth of the American currency, the USD/JPY pair is demonstrating an upward trend, trading around the mark of 135.
The Japanese government held a regular meeting to assess the situation with the spread of the omicron coronavirus strain, after which Prime Minister Fumio Kishida announced that there would be no lifting of restrictions announced but instead, sanitary measures were taken in 13 prefectures, including Tokyo will be extended for another three weeks in order to contain the spread of the infection.
Japanese business as well as the USD/JPY Forex forecast has reacted negatively to this news, and it is clear that the decline in economic activity will continue.
According to the latest Forex USD/JPY news, the Japanese household spending index for May rose by 0.1% instead of the 0.7% growth expected by analysts, and the annual rate decreased by 0.2% instead of an increase of 0.3%, which indirectly confirms the negative consequences of the measures undertaken by authorities.
USD/JPY Forex forecast levels
The USD/JPY Forex trading chart technical indicators have reversed and show a stable buy signal:
- Fast EMAs on the alligator indicator are above the signal line,
- The AO oscillator histogram is forming up bars.
USD/JPY Forex live resistance levels are:
And the support levels are:
How did the Forex USD/JPY news influence the price?
The Bank of Japan continues its ultra-soft monetary policy, leaving the interest rate at -0.10%, and the yield of 10-year bonds at about 0%, expanding the program for buying an unlimited number of them at a rate of 0.25%.
The decision was made almost unanimously, and only one of the board members voted for the start of tightening monetary policy. However, the authorities note the negative effect on the economy from a sharp weakening of the yen to 24-year lows, which increases import costs and makes it difficult for local companies to make business and Forex live chart USD/JPY forecasts even in the short term, as Japan failed to fully recover from the effects of the coronavirus pandemic.