© Dukascopy Bank SA
Following weeks of trading in the sideways trend, the USD/JPY currency pair showed some sort of activity, even though it took place only at the end of last week. There were important news both from the United States and Japan in course of the period from April 27 until May 1; however, only a small part of them succeeded in driving the Japanese currency against the Greenback in any direction.
While hovering in a clear neutral trend on Monday and Tuesday, USD/JPY attempted to edge higher on a third day of the period in the middle of last week. It was announced that the American economy rose just 0.2% in January-March, quarter-on-quarter. The result came much worse than forecasted, while average analysts' predictions stayed around one full percentage point of growth, still down from 2.2% in Q4 2014. Despite these figures and somewhat dovish Federal Open Market Committee's statement on Wednesday, the US Dollar has hardly show some movement and failed to sustain its sluggish growth towards the end of the day. In the meantime, more significant developments could be observed on Thursday and Friday. At first, some volatility was created by the Bank of Japan's meeting, which kept its quantitative easing measures unchanged so far, but signaled it can be in a position to add up to stimulus later this year, especially in case inflation remains subdued and fails to return towards the target of 2%. Earlier this year, Japan's CPI fell sharply due to shrinking oil prices.
While closing on a positive note at the 120.20 level on Friday, the pair is estimated to calm slightly down this week, possibly falling back below 120 but remaining largely inactive. Still, the majority of Dukascopy Community members prefer a positive case for the Greenback, namely in two thirds of all the cases.
© Dukascopy Bank SA