When is Japanese Q2 final GDP data and how could it affect USD/JPY?

Japan’s Finance Ministry is up for releasing the final reading of second quarter (Q2) 2019 gross domestic product (GDP) figures at 23:50 GMT on Sunday (early Monday morning in Asia).

Market consensus suggests 0.3% figure of the growth signal versus +0.4% preliminary forecast on a quarterly basis. Further, the yearly format indicates 0.4% growth of the headline economic data compared to +0.1% prior. Furthermore, GDP annualized may weaken to 1.3% from 1.8% earlier.

How could Japan’s preliminary GDP affect USD/JPY?

Japan’s latest Leading Economic Index and Coincident Index joined a slew of downbeat data from the Asian economy, which in turn support the Bank of Japan’s (BOJ) preference for ultra-loose monetary policy. As a result, a weak growth reading can escalate the USD/JPY pair’s recent upside. Adding to the sentiment is receding odds for a hard Brexit and optimism surrounding the US-China trade talks.

In a case where GDP rises beyond expectations, the USD/JPY pair may witness a pullback towards 21-day exponential moving average (EMA) level of 106.55 with last week's low near 105.75 likely being following support to watch. It should also be noted that pair’s upside, backed by weaker data, will find it hard to cross the 50-day EMA, at 107.07 now, that holds the key to 100-day EMA level of 108.00 and August high around 109.10.

Key Notes

USD/JPY Analysis: holding ground, bullish

USD/JPY technical analysis: Greenback loses the 107.00 figure against Yen after NFP

About the Japanese Q2 final GDP

The Gross Domestic Product released by the Cabinet Office shows the monetary value of all the goods, services and structures produced in Japan within a given period of time. GDP is a gross measure of market activity because it indicates the pace at which the Japanese economy is growing or decreasing. A high reading or a better than expected number is seen as positive for the JPY, while a low reading is negative.