Japan is a brighter spot in an otherwise troubled APAC macro picture

Earlier today, Japan reported its Gross Domestic Product for the second quarter Q2 which beat expectations by 0.1%.

The data arrived 0.5% vs 0.4% expected and 0.3% prior. 

This has had little impact on the market. USD/JPY stands at 110.27, a touch away fr the highs in a bullish US dollar environment. 

Nonetheless, it is a brighter picture in an otherwise troubled maco outlook for the APAC markets, plagued by rising Delta variant infections throughout the region. 

Yesterday, the Reserve Bank of Australia was cautious at its meeting.

The Bank signalled that they will continue bond purchases at A$4bn/week until at least mid-February 2022, from their earlier November 2021 review.

However, the RBA acknowledged the poorer-than-expected economic outlook and decided to hold the reduced QE pace of A$4bn/week until at least mid-February next year due to the lockdowns. 

However, in Japan, the bank of Japan is firmly on hold and an economic recovery is likely to be mild due to the nations pandemic state of emergency which is likely to weigh on service businesses.

Moreover, the Japanese government is eyeing an extension of the COVID-19 state of emergency for Tokyo, neighbouring and some other prefectures past its Sept. 12 end date.

USD/JPY refreshes daily highs above 110.20 amid higher US Treasury yields