Last Friday (February 17), the Bank for International Settlement (BIS) released the actual effective exchange rate data for the yen against the US dollar in January 2017.
yen is underestimated In January 2017, the yen was still underestimated (below 100.00). The actual effective exchange rate index is 76.06, the lowest level since February 2016. An actual effective exchange rate below 100.00 indicates that the yen is undervalued, and above 100.00 indicates that it is overvalued. Japan previously hit its second highest current account surplus in 2016, and the undervalued yen is in stark contrast to this fact. The released data also showed that Japan's trade deficit rose to US$108.69 billion in January 2017. However, this data may be distorted, with Japanese exports weakening due to New Year reasons. At the same time, the rise in oil prices has also stimulated Japan's imports. USD to JPY technical analysis Earlier on Monday (February 20), the USD to JPY exchange rate hit a low of 112.79. If the US dollar breaks through the 10-day moving average against the Japanese yen, it is expected to rise to the 5-day moving average 113.52 and 114 in the future. On the other hand, if exchange rate breaks downward and breaks through the intraday low of 112.79, it will continue to decline, and test the downward trend line around 112.50 again. The intraday closing price below this will close at a February 2 low of 112.05. At 12:49 Beijing time, the US dollar against the Japanese yen was 113.06/09.
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Text source: http://news.fx678.com/C/20170220/201702201154582074.shtml
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