On Wednesday, Japanese yen has stopped weakening vs the US dollar, though further changes remain possible. The yen-to-US dollar exchange rate stays were recorded at some 110.18. The American currency had strong positions even on weak April retail sales data in the USA released yesterday. For now, 10Y US state-bonds yield keeps rising, staying above 3 %, while the possibility of the further upturn on American platforms persists as well despite 10-day buying. As a result, the greenback seems to have good positions even despite below-expectation results in April.
Japan reported sluggish data this morning. According to the preliminary estimate, Q1 GDP decreased 0.2% q-o-q (forecast – 0%; Q4 2017 – 0.4%). The year-to-year figures were also low. According to the released data, GDP in January-March dropped by 0.6%, compared to a 0.6% upturn earlier.
Current Japan's figures show that the country can face certain problems unless the results are connected with local and seasonal factors. The economy has collapsed for the first time over 8 quarters. As the statistics show, some decline was recorded in business spendings, though private consumption remained unchanged. This means that the real problems lie deeper. Industrial production rose 1.4% y-o-y in March, which is well above the forecast (1.2% y-o-y).