USD/JPY Fundamental Analysis October 6, 2014 Forecast

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Updated: Aug 24, 2015, 22:00 UTC

Analysis and Recommendation: The USD/JPY climbed 33 points to trade at 108.79 as the US dollar eased on Thursday ahead of today’s nonfarm payroll report.

USD/JPY Fundamental Analysis October 6, 2014 Forecast

Analysis and Recommendation:

The USD/JPY climbed 33 points to trade at 108.79 as the US dollar eased on Thursday ahead of today’s nonfarm payroll report. According to the Cabinet Office, bad weather is forecast to have trimmed private spending — accounting for around 60 percent of Japan’s gross domestic product — by 0.3 point to 1.0 percentage point from the previous quarter on an inflation-adjusted basis during the three months through September. The Japan Center for Economic Research said last month that the economy is expected to rebound by an annualized 4.0 percent in real terms in the July-September quarter, citing the average projection of 41 private-sector economists.

The economy plummeted by an annualized real 7.1 percent in the April-June quarter, its worst setback since the first quarter of 2009, when it tumbled an annualized 15.0 percent after the 2008 global financial crisis unfolded. The July-September GDP data will be closely watched as Abe has said he will use it to make a final decision.

Companies are forecasting sustained price gains over the next five years, signaling progress in reflating the economy, albeit below the Bank of Japan’s target.

BOJ Gov. Haruhiko Kuroda is counting on rising inflation expectations and an economy growing above its potential to drive price gains that are still halfway to the bank’s 2 percent target.

Prime Minister Shinzo Abe is weighing another sales-tax increase that would risk damaging the growth outlook after an April hike triggered the steepest contraction in five years.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Today’s economic releases actual vs. forecast: