This JPY update examines factors that could affect Japanese Yen exchange rates in the coming weeks. The table here displays the market movements for GBP/JPY over the last month:

Currency Pair% ChangeDifference on £200,000
GBPJPY-1.77%JPY 531,162
Japan to hike Consumption tax

Will Shinzo Abe become the longest standing Japanese PM, and how could this impact the Japanese Yen?

One of the major political stories of the weekend was the Japanese general election vote result. The voting took place the weekend prior but the result was announced on Sunday, with the current Prime Minister Abe maintaining the ruling coalition’s two-thirds majority.

He called the snap election earlier this year and managed to achieve what the UK Prime Minister had hoped to, as now he’s likely to be the leader of the Liberal Democrats next year after maintaining the seats he had.

The Yen, because of its status as a safe haven currency could be considered quirky, as off the back of the result the Nikkei (Japanese Equity Market) rallied to a 21-year high whilst the Yen fell sharply (which is a good thing for the Japanese economy at present).

Due to the complex nature of the monetary policy that will now be implemented by the Bank of Japan, along with the inverse relationship between Japanese equities and the Japanese Yen, I’m expecting to see the Yen weaken as the year goes on.

My thinking behind this is the likelihood of the current status quo (Abenomics) in Japan is now likely to continue with further monetary easing likely, along with high levels of Japanese banking liquidity.

Abenomics is now 5 years old and the primary goals of the policy are to improve Japan's economy steadily, stabilise the inflation numbers and weaken the Yen.

What Data could impact GBP/JPY this week, and how can I prepare for it?

There is a number of Japanese data releases this week, so if you have a currency requirement involving the Yen it’s worth getting in touch to discuss this.

On Wednesday there will be an update regarding foreign investments into the country, along with inflation data on Thursday.

Both of these data releases occur outside of market hours, so looking into a Limit Order may be a worthwhile option in case the market jumps in your favour. This is an order to trade at a target price, and these types of trade contracts can take place outside of market hours automatically.

Do feel free to get in touch if you wish to discuss this trade option in more detail. I'd be more than happy to discuss any queries you have about upcoming transfers, you can reach me on 01494 725 353 or email me here.


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Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.