According to the preliminary report released by the Finance Department of Japan, Japan’s biggest manufacturers have been less active in Q1 2015. Fitch rating agency warns that this may lead to some problems for Japanese banks due to negative interest rates.
Top be more specific, the index value for major Japanese manufacturers dropped all the way down to -7.6% over the reporting period. This is confirmed by the same report released by the Finance Department of Japan. The previous value was 3.8%. At the same time, analysts had expected 4.2%. this time, which leads us to believe that they failed to predict the value.
It is interesting to note that the mentioned index reflect the opinion expressed by the managers of Japan’s major corporations regarding the current economic situation in the Japan as well as its prospects, which is used to define economic tendencies. Any negative value indicates pessimistic bias. If that’s the case, the index affects the Japanese Yen.
With that being said, the latest figures indicate that the Japanese economy has already lost the upward momentum. This started happening in early January 2016.
FOREX
In the meantime, Masterforex-V Academy experts report that the Japanese Yen feels like continuing its retracement against the U.S. Dollar, which means that USDJPY is going up. To be more specific, the currency pair is forming wave 3/C of level Weekly inside the mentioned move, the experts say.
A break below the local low of 110.7 will continue the current bearish wave through sub-wave 5 or the “Hound of the Baskervilles” pattern by Elder/MF. The closest levels of support can be found at 110.51/15, 109.18, 108.45/36.
At the same time, a break above MF pivot 121.63 and the top of the descending MF sloping channel will indicate the end of the current move.
