The japan Ministry of Finance has been up to for the release of the preliminary session of the first quarter (Q1) 2020 Gross Domestic Product (GDP) figures at 23:50 GMT on Monday.
The market consensus suggests an optimistic -1.2% t / t man vs -1.8% prior. In addition, the yearly format also indicates the consolidation of the Japanese yen is in negotiation with a likely -4.6% compared to the earlier -7.1% of GDP.
Before the release, Westpac stated, “The market expects Japan’s to slip into a technical recession, with a The GDP the contraction, or 1.1% in the 1st quarter. The research progresses, the more steep the fall, it is likely in Q2.”
How could it affect the USD/JPY?
In its latest Outlook for Economic Activity and Prices, the BoJ said the economy is “likely to remain in a severe situation for the time being, due to the impact of the feline corona virus (COVID-19), and in the event of a pandemic. This suggests a further weakening of economic activity. The central bank has lowered the forecast of GDP for the year 2020, up from -3.0% year-on-year at the earliest, at -5.0%. In addition to expect additional hardships for the economy, mainly due to the virus itself is beautiful and stands ready, as always, to the easing of monetary policy further. However, Governor Haruhiko Kuroda stayed away from negative rates, in his last appearance.
That said, while the continuation of the weakening of the GDP, could continue to exert downward pressure on the pair, which is optimistic readings are less likely to have a lasting positive impact. Similarly, the presence of risk aversion, mainly due to the us-China tension and the outbreak of virus fears, could help the Japanese currency to be at a sizeable loss.
Technically, the buyers are waiting for ” the effort of the break above the 50-day EMA of 107.65 to challenge the value of the bass, or at 107.77-and-aim-for-the-mid-April, the peak of near 108.10. On the other side of the coin, 106.75, and the lowest value or 106.00 can entertain the vendors when the freshness of the cuts.
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On the Co’s Q1 Preliminary GDP
The Gross Domestic Product released by the cabinet Office shows the monetary value of all goods, services, and structures produced in Japan within a given period of time. The GDP is a gross measure of market activity because it indicates the speed at which the Japanese economy is growing or decreasing. A reading as high or higher than the expected number is seen as positive for the JPY, while a low reading is negative.