The USD/JPY pair continues growing on Friday; no serious demand for the Japanese currency appeared.
The Japanese Yen is still slowly retreating against the USD. the current quote for the instrument is 112.96.
In the morning, Japan reported on the Average Cash Earnings, which expanded in August by 0.9% y/y. The July reading was 0.6% y/y and the expected one – 0.5% y/y. The indicator includes the earnings before tax deductions, but doesn’t take into account the interests received from investments into assets. It is thought that the more people earn, the more they will spend later. It’s good for the retail sales sector and for the entire economy in general.
Nowadays, there are serious parapolitical discussions in Japans as the country is expecting elections. The current Prime Minister, Shinzō Abe, has a very serious competitor, Yuriko Koike, whose words sometimes surprise investors. But the most part of what Yuriko Koike says is connected to the Japanese revenues and expenses. For example, Koike and her supporters are very positive about the deferral of the sales tax increase. The increase is planned for spring 2019, and the opposition believes that the country’s economy won’t be strong enough by that time to get over it without any stresses.
Koike’s party is going to rely on the private demand, which may instigate a new round of the Japanese economy recovery. It’s quite reasonable in some way, but on the other hand the QE program has been going on for years and looks pretty effective. There is no point in rejecting the program, which was so money- and time-consuming.
In the evening, the USD/JPY pair may become more volatile because of the employment market statistics to be published by the USA.
RoboForex Analytical Department