The Yen is ready to attack. Overview for 05.12.2019

05.12.2019

After completing the correction, USDJPY is ready for a new decline; “safe haven” assets are in demand again. 

The Japanese Yen is rising a bit against the USD on Thursday morning. The current quote for the instrument is 108.83. 

In the morning, Japan unveiled a $120 billion fiscal boost to fight external risks and support stalling growth. Average forecasts for the Japanese GDP in 2019 imply +0.8+0.9%, but expectations for 2020 are much worse and may be as little as +0.5%. This is too little for such a powerful economy as the Japanese one. 

No details were announced, but they will be after the package is approved by the Cabinet. However, according to the Reuters, the Prime Minister Shinzo Abe said that “it’s based on three pillars of ensuring disaster rebuilding and safety, providing intensive support to overcome downside economic risks and sustaining economic vitality after the Tokyo Olympics”.

The spending will spread over a supplementary budget for this fiscal year to March and an annual budget for the coming fiscal year from April, both to be compiled later this month.

The fact that Japan is ready to extend the stimulus program indicates the country’s economy lacks positive momentum. If it hadn’t been for the US-China trade wars, which affect Japan pretty much, the Japanese GDP would have been way better, but alas. 

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Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.