Trade Desk Thoughts - Japanese Trade Balance

Japanese Trade Balance Actual -0.11T, Expected 0.12T, Previous 0.17T

Release Explanation: This report measures the difference between the total value of exports and the total value of imports. A positive figure indicates a trade surplus while a negative value represents a trade deficit. Because Japan's economy is highly export-led, trade data can give critical insight into developments in Japan's economy and changes into foreign exchange rates.

Trade Desk Thoughts: Japans exports have declined in August which was led by a slowdown in the shipment of vehicles to the U.S. as consumers curb spending in the face of the financial crisis. This increases the likelihood that the Japanese economy will stay in a recession until at least 2009. Total shipments to the U.S. dropped 21.8 percent, which is the largest decline ever seen. Exports to Europe also fell to 3.5 percent.

Forex Technical Reaction: The Japanese yen is still oscillating around its 200 day SMA which also ties up closely with the neutral pivot point.

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