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Japan's Economy Grew in the Second Quarter

8/16/2022 12:05 PM

Quotes of USD/JPY are correcting at 133.40.

The yen continues to resist the recovery of the dollar, but at yesterday's trading retreated somewhat from its local highs after the publication of macroeconomic statistics. Japan's Gross Domestic Product (GDP) added 0.5% in the second quarter, compared to a 0.6% growth forecast, and grew 2.2% year-on-year, also slower than the 2.5% expected by analysts. Nevertheless, experts assessed the released data positively, as the Japanese economy became one of the few that showed positive dynamics in the second quarter of 2022. The outlook for the future, however, is negative due to the new coronavirus outbreak and higher commodity prices. In addition to GDP, Consumer Spending also rose, adding 1.1% in the second quarter after rising 0.1% in the previous period. The main positive moment of the report was the data on the volume of Industrial Production, which grew by 9.2% in July, despite the fact that analysts expected a reduction of 7.5%.

In turn, the US dollar strengthened in yesterday's trading, once again exceeding 106.000 in the USD Index. Today, investors will pay attention to data on the construction market: analysts suggest that the number of Building Permits issued in July will be 1.650 million after 1.695 million in the previous month, and the volume of Housing Starts will decrease to 1.540 million from 1.559 million. If the forecast is realized, the decrease in indicators will be recorded for the fourth month in a row.

USD/JPY is trading within the global uptrend, being at the support line. Technical indicators keep a stable sell signal, which has recently intensified: the range of EMA fluctuations on the Alligator indicator is still wide and the histogram of the AO oscillator is forming new descending bars, being in the sales area.

Support levels: 131.57, 126.80. | Resistance levels: 134.97, 138.95.

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