JPY Markets Trend for 2019

On account of the stronger Dollar fundamentals, the Yen lost ground against it over the course of 2018, although it registered significant gains in December, reducing the overall blow. Currently trading at 108.8, compared to 111.01 in the first week of 2018, the pair has an immediate Support level at 108.50, and a subsequent one at 104.87. The closest Resistance level stands at 111.43.

The Japanese economy appears to have left the perils of the past behind and is now growing at a moderate yet stable rhythm. Overall leading economic indicators are in the black, with both manufacturing and non-manufacturing outlooks being positive. The country keeps importing more, signifying that consumption is growing, while inflation, the utmost worry for the Japanese economy, appears to remain above zero, despite fluctuating on a m/m basis.
Furthermore, the unemployment rate continues to remain low, while retail trade keeps growing. BoJ policy is still accommodative, with no change in interest rates expected, at least until inflation manages to remain close to the target for a significant amount of time. No major political events are expected to take place in the country over 2019, thus Prime Minister Shinzo Abe will still maintain the majority in the House of Representatives, and Abenomics will continue boosting the Japanese economy.

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