Trade Desk Thoughts - Japanese Unemployment Rate

Japanese Unemployment Rate Actual 4.0%, Expected 4.1%, Previous 4.1%

Release Explanation: This report measure the percent of unemployed persons in the labor force. The unemployment rate can be a leading indicator of the overall health of the labor market. Higher unemployment leads to less income for Japanese workers who, in turn, may reduce consumption. As consumer spending contributes to a majority of Japan’s GDP, developments in the labor market directly affect prospects for Japanese growth.

Trade Desk Thoughts: Japans unemployment stayed near record highs as job prospects worsened. The jobless rate fell to 4 percent for July, while economists were expecting a reading of 4.1 percent. The Bank of Japan stated that the economy had become “sluggish” for the first time in ten years citing higher fuel costs as a main driver. The unemployment rate is yet another sign that Japans economy is on the brink of a recession.

Forex Technical Reaction: The yen is currently entangled in its 20 day SMA as it has been for the past seven trading days. The pair has also failed to break above R1 or below S1 for the past four days.

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