The Japanese yen is rising against its American counterpart on Tuesday as officials maintain an upbeat tone on the national economy. This week, Japanese leaders are in China to discuss trade and find ways to improve commerce and relations amid trade tensions with the US.
On Tuesday, Japanâs Cabinet Office released its monthly economic report and it showed that the economy is gradually recovering, despite exports slowing down â the government reported âalmost flatâ numbers. The data revealed that business investment is climbing and consumer spending is going up.
Officials are warning that the string of natural disasters that plagued Japan this past summer could impact overall third-quarter figures. They are also encouraging everyone to consider trade tensions between the worldâs three largest economies.
Attention should be given to the effects of situations concerning trade issues on the world economy, the uncertainty in overseas economies and the effects of fluctuations in financial and capital markets.
Washington has warned that it is ready to go to battle with Japan on trade. With Tokyo maintaining a trade surplus with the US, buoyed by automobile exports, the White House contends that it wants to bring it down and increase exports to Japan.
Bank of Japan (BOJ) Governor Haruhiko Kuroda assured policy advisers that though the stock market is experiencing some jitters, foreign exchange markets remain relatively stable.
Meanwhile, Prime Minister Shinzo Abe will sit down with President Xi Jinping for an important meeting. In recent weeks, officials and private sector leaders have been encouraging both sides to boost cooperation, trade, and commerce to offset the negative effects of the US-led trade war.
But the powwow comes as Tokyo announced that it was ending its official development assistance (ODA) to China now that it is the worldâs second-largest economy. The 40-year-old fund started when China was still a developing nation, offering a total of $32.4 billion in loans, grants, and aid. While no new loans have been extended for more than a decade, Japan is aiming to carry out a new form of âdevelopment cooperation dialogue.â
The USD/JPY currency pair tumbled 0.51% to 112.25, from an opening of 112.82, at 16:51 GMT on Tuesday. The EUR/JPY fell 0.39% to 128.87, from an opening of 129.36.
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