The rates continue in the frames of a downward trend in favor of the JPY. Recent data from Japan confirms a steady economic growth. The PMI manufacturing index was 53.6 pips, which is the highest level since February 2014. Inflation decelerated in October to 0.2%. Today the stable economic situation has been confirmed with new data about Japan's GDP, which grew by 0.6% in the third quarter and by 2.5% YoY, exceeding the forecasted level. The balance of the current account amounted to 2,176T, that is also more than investors' expectations. The future value of the yen will be depending on the Bank of Japan, whose representatives stated that they are ready to ease policy to stimulate the economy. This issue will be discussed at their next meeting this month.
The New Zealand dollar came under pressure this week because of the situation in Australia, where there are signs of slowing economic growth. The trade surplus amounted to only AUD 105 million, while the expected surplus was AUD 1.4 billion, i.e. 10 times more. A month earlier, the surplus amounted to 1,745 billion AUD, so nobody expected such a rapid decline. The AUD came under pressure also because of a record fall in copper prices.
The market didn't receive new data from New Zealand. In a week only we can expect data about the business activity index in New Zealand, as well as data from Tankan indices from Japan, which will lead to increased volatility at the end of next week. At the moment, the best would be the short deals on the trend, which is confirmed unanimously by the oscillators (MACD, Stochastic).
