USD/JPY May See Further Decline
May 19th, from WikiFX News. Japan’s government data released on Monday shows that due to the pandemic and the consequent lockdown measures, Japan’s GDP in Q1, 2020 fell 3.4% year-on-year, shrinking for the second straight month and matches the technical definition of an economic recession. This has been the first time after the second half of 2015 that the country faces a recession.To get more news about WikiFX, you can visit wikifx official website.
After the Fed’s aggressive monetary policies, USD/JPY still faces down-slope risks. The Fed’s active policy response helped reduce dollar’s risk of appreciating against traditional safe-haven currencies such as JPY and CHF, which made the Federal Reserve balance sheet rapidly growing to nearly US$7 trillion.
If the situation of the financial market again deteriorates, the yen will be the largest benefactor. The bank of Japan’s latest quantitative easing policy alone is not enough to change the yen’s strong momentum.