USD/JPY: Vigorous bounce to re-claim 109.00 level

By FXStreet USD/JPY has made a sartling recovery, last at 109.10, after a vigorous rebound off 108.72 day lows, with traders reacting to the surge in the Nikkei 225, currently up 0.42% after an early sell-off.

Japanese GDP Q1 upbeat

Today’s price action comes in response to much better-than-expected Japanese growth figures for the first quarter of 201. Japan’s preliminary real Q1 2016 GDP came at 0.4% q/q vs 0.1% expected, with the Q1 annualised GDP at +1.7 pct vs +0.2% expected. Solid exports and a boost from the extra day from the leap year were the main factors contributing to the upbeat data, Reuters reported.

‘Green shots’ a catalyst for higher Nikkei, lower Yen?

It is also worth noting that in light of the recent growth figures in the Eurozone, improving economic indicators in the US, and now better Japanese GDP 1, the market may start to experience a potential transition by which it starts to perceive global growth gradually picking up. If that were the case, Japanese investors may consider the improving landscape not so much as Yen positive/Nikkei negative in diminished hopes of further BOJ easing, but rather, they might price in this tentative growth environment as bullish for stocks, which …read more

Source:: FX Street