Japanese yen is mostly lower against its major counterparts today, following the latest GDP data. With the GDP for quarter two growing less than expected, renewed calls for stimulus are dominating the rhetoric.
The latest Japanese GDP data, for quarter two of 2014, show that the economy shrunk by 1.8 per cent. The news is proving a blow for Prime Minister Shinzo Abe, who continues to struggle as his ambitious economic stimulus program flounders.
With the lower GDP reading, many are asking that a planned sale tax increase be delayed. The last increase has apparently slowed the economy too much, according to some, and that means that they need to re-evaluate the situation. Additionally, there are many calling for more stimulus from the Bank of Japan to help kickstart the economy.
This news means that the yen is likely to remain weak for some time, since there are expectations that Japanese policymakers will be even more inclined to pursue policies designed to keep the yen lower against its counterparts in an effort to boost the economy.
At 10:25 GMT USD/JPY is up to 105.2000 from the open at 105.0890. EUR/JPY is also higher today, gaining to 136.1960 from the open at 136.0550. GBP/JPY is lower, though, thanks in large part to sterling’s own woes. The pair is down to 169.4645 from the open at 169.7750.
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