Fundamental Analysis on April 21, 2023: Inflation in Japan Stabilizing


High inflation is not such a big problem for Japan as it is for, for instance, the US and the UK. Although the sharp jump in the Core CPI in Japan two months ago to 4.1% in annual terms caused alarm, the data published this morning (although it testified to an unusually high level of inflation for Japan) generally reduced the degree of alarm:

→ Core CPI (today): 3.1%: (expected 3.1%).

→ Core CPI (a month ago): 3.1%.

→ Core CPI (a year ago): 0.8%.

As a result of published data on inflation, the yen strengthened in the morning. The demand for the Japanese currency is also facilitated by the following facts:

→ the banking crisis has practically not affected the banks of Japan;

→ oil prices are adjusting after the decision to limit OPEC+ production (oil is an important import product to Japan);

→ disappointing first-quarter financials from some companies in the US. Foreign investors poured almost $12 billion into Japanese equities last week, their largest investment since at least January 2018, according to Reuters.

The daily chart shows that the USDJPY rate is forming a reversal (1) from the upper border of the descending channel A1-A2, as a result of which the price may again test the long-term trend line (2). More frequent attempts to touch this line may indicate that the bears' attempts to break through it are becoming more and more persistent.

This forecast represents FXOpen Companies opinion only, it should not be construed as an offer, invitation or recommendation in respect to FXOpen Companies products and services or as financial advice.

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips. Open your FXOpen account now or learn more about trading forex with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Latest from Forex Analysis

Market Analysis: AUD/USD and NZD/USD Set Sights on Additional Upside The US Dollar Is Weakening Following Inflation Data Dollar Adjusts After the Publication of Inflation Data in the US Market Analysis: EUR/USD Sees Green as USD/JPY Gains Bullish Traction GBP/USD Analysis: Pound Recovers After the Bank of England Decision

Latest articles

Financial Market News

Weekly Market Wrap With Gary Thomson: S&P500, US Dollar, Gold Price, PEP Stocks

Get he latest scoop on the week's hottest headlines, all in one convenient video. Join Gary Thomson, the COO of FXOpen UK, as he breaks down the most significant news reports and shares his expert insights. Read the latest news


The Price of Silver Has Reached Its Highest Level in Over Three Years

As indicated by the XAG/USD chart today, the intraday price of silver reached $29.84 per ounce yesterday, while the previous yearly high on 12 April was $29.79. The last time this price was seen was in February

What Is the Wolfe Wave, and How Can You Trade It?
Trader’s Tools

What Is the Wolfe Wave, and How Can You Trade It?

The Wolfe Waves is a powerful chart pattern recognised for analysing potential price reversals. Named after Bill Wolfe, who developed this formation through extensive trading practice, Wolfe Waves provide traders with a structured approach to anticipate market movements. In this

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.