(MENAFN- DailyFX) Talking Points:
Japan's June trade balance came in some way below expectations However, the reason for this seems to have been higher imports This may not displease the Bank of Japan, which will set monetary policy later Thursday Get trading tips and live, interactive coverage of major economic indicators at the .
The Japanese Yen slipped a little Thursday after its homeland's trade balance came up short. However, exports continue to rise very strongly and the data were far from weak overall.
Official figures showed a balance of JPY439.9 billion (US$3.9 billion), some way below the JPY488 billion which markets had expected. However, behind the headlines were a robust, 15.5% annualized gain for imports and a 9.7% export rise. Exports have now gained for seven straight months, with external demand embedded a clear driver of Japanese growth. Shipments to China were especially strong, rising 19.5% on the year. Asia as a whole took 13.6% more, while exports to the US grew by 7.1%.
However, these data offer more hope for domestic demand than has been seen of late, with imports also rising strongly. initially rose but didn't get far and soon slipped back. The pair has been in a pretty tight range through the Asian morning as investors look to the Bank of Japan's monetary policy decision due at some point in the day.
The BoJ is expected to leave its ultra-loose policy settings well alone. Assuming it does, Governor Haruhiko Kuroda's post-decision press conference will probably attract at least as much investor attention as the decision.
--- Written by David Cottle, DailyFX Research
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