The Yen remains under pressure. Overview for 22.11.2021
USDJPY is keeping its positive momentum; market players are very interested in what is happening in the Japanese economy.
The Japanese yen is retreating against the USD on Monday afternoon. The current quote for the instrument is 114.18.
The Japanese authorities become seriously focused on rebooting the country’s economic growth and decided to implement a new stimulus package worth ¥79 trillion ($690 billion), which includes the fiscal spending of around ¥56 trillion.
The stimulus package is expected to provide conditions for the economic growth of 5.6% on average. The stimulus package is about 10% of the country’s GDP. Apart from positive effects, the package will increase the national debt. The current debt parameters in Japan are the highest among the first world countries, so it’s obvious that Japan undertakes heightened obligations.
At the same time, it’s important to realise that the Japanese government has neither a firm plan nor an understanding of what the country will do with the national debt in the future.
The key task right now is to revive the economy and the current plan is perfect for that. The GDP should get back to normal before the government starts closing the QE program.
For the Yen, the new stimulus package is a factor of pressure.
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