USD/JPY slipping through 200 DMA - BBH

By FXstreet.com | July 08, 2014 AAA

FXStreet (Guatemala) - Marc Chandler, Global Head of Currency Strategy at Brown Brothers Harriman notes the conditions surrounding USD/JPY.

Key Quotes

"Japan reported larger-than-expected current account surplus for May, helped by a smaller trade deficit."

"The May current account surplus rose to almost JPY523 bln, 20% larger than expected, after a JPY187.5 bln surplus in April. The trade shortfall narrowed to JPY676 bln from JPY780.5 bln."

"The monthly numbers swing around a bit, but looking at a rolling 12-month basis helps illustrate the deterioration in Japan's external
account. In the 12-months through May, Japan recorded a cumulative current account surplus of JPY191 bln."

"In May 2013, the same metric stood at JPY4.9 trillion. The change is due to the deterioration of the trade balance."

"In the 12-months through May, Japan has recorded a JPY10.9 trillion trade deficit (on a balance of payments accounting). In the 12-month
period through May 2013, the trade deficit was JPY5.7 trillion."

"The dollar has surrendered the gains recorded on the back of the strong US employment report. The dollar has again slipped through the 200-day moving average (~JPY101.82). The US 10-year yield is slipped below 2.60% today and this is keeping the dollar on the defensive against the yen."

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