Japan Announces Economic Stimulus on Tuesday, Yen Weak

The Japanese yen was one of the weakest currencies today due to markets being in a risk-on mode, meaning that there was limited demand for safer currencies. The yen fell against almost all of its rivals, though managed to stay flat against the US dollar. Additionally, EUR/JPY has retreated to trade close to the opening level at the time of writing after rallying earlier.
Yesterday, Japanese Prime Minister Yoshihide Suga announced a fresh economic stimulus package worth ¥73.6 trillion ($708 billion). The new package followed two previous packages worth a combined $2.2 trillion introduced earlier this year. Suga explained the decision to add even more stimulus measures:

We have compiled these measures to maintain employment, sustain business and restore the economy and open a way to achieve new growth in green and digital areas, so as to protect people’s lives and livelihoods.

A report released on Tuesday showed that the Japanese economy has emerged from recession last quarter. Gross domestic product rose by 5.3% in the third quarter of 2020 according to the final estimate, while economists were expecting it to remain unchanged from the reading of 5.0% shown in the preliminary estimate. The growth followed three consecutive quarters of contraction.
As for today’s data, Japan’s Cabinet Office reported that core machinery orders climbed by 17.1% in October after falling by 4.4% in September. Experts had predicted a much smaller increase of 2.6%.
USD/JPY was little changed at 101.15 as of 13:55 GMT today. EUR/JPY was up from 126.05 to 126.18 but has pulled back from the day’s high of 126.52. GBP/JPY gained from 139.10 to 140.17.
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