On Friday afternoon, the USD/JPY pair is trading with an increase in the anticipation of the Bank of Japan to mitigate the monetary conditions.
The Japanese yen was being sold yesterday and continues to be sold today. The current price of the USD/JPY pair is 119.15. Technically, the instrument clearly intends to move to 120.0 and maybe slightly higher.
The next meeting of the Bank of Japan is scheduled for the 30th of October, and market expectations suggest at least there will be a statement that economic stimulus programs should be expanded. However, before that, on October 28-29, will be held a regular meeting of the Federal Reserve, after which currency pairs are usually stormy.
Today the Prime Minister of Japan, Mr. Abe said in a speech at the end of a government meeting that the inflow of investments into the economy of the state is still insufficient. A representative of the investment firm Black Rock was invited to advice - this alone indicates a willingness the Japanese authorities to cooperate with businesses and to work together. This is a good signal.
At the same time the head of the Bank of Japan Mr. Kuroda stressed that the monetary policy in its current version is effective. According to him, domestic demand in the country is enhanced and will continue to move in a positive direction. This fact supports the restoration of the economic system as a whole.
So far it's only words. Statistics show that the Japanese version of the QE is very effective, but the effect is no longer sufficient - inflation still escapes from the grasping hands of the BoJ. Incentives need to be strengthened so that the money already spent does not go anywhere. Another thing is how the situation will be with the public debt, which is growing steadily and confidently.