FXStreet (Barcelona) - Lee Hardman, FX Analyst at the Bank of Tokyo Mitsubishi UFJ, observed the current softness around the Japanese currency.

Key Quotes

"Disappointing trade report reinforces yen selling pressures The yen has underperformed in the Asian trading session with USD/JPY rising to its highest level since the 7th April. The yen has been trading on a weaker footing since the release of the weaker than expected Japanese GDP report for Q2, and its decline accelerated overnight after USD/JPY broke above the 103.00-level."

"The move higher in USD/JPY is in part driven by a stronger US dollar but also likely reflects building investor expectations that the BoJ will act to accelerate monetary easing later this year to support economic growth in Japan which has clearly lost upward momentum. The recent disappointing economic data flow from Japan continued overnight reinforcing yen selling pressures."

"It was revealed that Japan’s trade deficit on a seasonally adjusted basis continued to remain elevated at JPY 1.024 trillion in July. It was the second consecutive monthly trade deficit totalling over JPY1.0 trillion and the ninth in the last twelve months."

"Over the last twelve months Japan’s trade deficit has totalled just over JPY14 trillion equating to around 2.9% of GDP. The marked deterioration in Japan’s trade deficit remains a weight on the yen."


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Forex pairs in this Article » USD/JPY

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