Japan dominated this week’s fundamentals as the nation still facing unstable fundamentals supporting recovery and rising local currency value, especially after the yen managed to reach the highest in 14 years against the dollar.

Weak dollar alongside pessimistic fundamentals released from major economies, led to a weak dollar that helped the yen to record the highest in 14 years against its American counterpart to trade near the 86.00. That was followed by the statement of the Japanese Finance Minister saying the government is monitoring closely the yen moves, which is threatening exports the main pillar for economic growth, making Japan’s products lose a competitive advantage.

Such statements means the Bank of Japan is about to interfere in the currencies market selling the yen to lower its value to bring it back to acceptable levels against the dollar and other major currencies, to guarantee exports recovery that is supporting the whole economy.

The Bank of Japan released its minutes saying that the bank intends to keep interest rates at its low level, besides working to keep an accommodative financial environment in Japan. The bank agreed on extending the collateralized lending program if it is needed to support the economy.

 However, a monetary policy maker said in the bank’s monthly report that economic recovery is backed by the stimulus measures locally and globally, despite the pace of local recovery through domestic demand remains weak. Policy makers added that economic conditions in Japan are expected to continue improving.

According to the bank’s report, public investments are increasing, while exports and production are advancing and the decline in capital spending by companies which reflects corporate earnings, is about to end. The report added that private consumption especially for durable goods is recovering, but the labor market and income levels still weak and housing investments continued to drop.

As for fundamentals released from Japan, it showed Japan’s jobless rate declined to 5.1% in October compared with 5.3% in September, and the reading came opposing analyst’s forecasts of an incline to 5.4%. The job to applicant ratio inclined to 0.44 from a previous 0.43 and it came inline with anticipations.

On the other hand, unemployment rate remains high even after three straight declines and that can be proved through the proportion of college students with job offers as it tumbled 7.4 percentage points from a year earlier to reach 62.4% the steepest decline since the survey began in 1996. Yet, the government said in today’s report that the employment environment for fresh graduates is “extremely sever”, wroth mentioning that the government pledged to provide 100,000 jobs by the fiscal year ending in March.

Fundamentals showed the deflation risks remain threatening the world’s second largest economy, having consumer prices declining 2.5% in October from a year ago. Consumer prices excluding fresh food and energy dropped 1.1% from a prior decline by 1.0%.

The Bank of Japan expected in its monthly report that the drop in consumer prices will moderate on the medium term as energy and raw materials prices are recovering along with rising world demand. Recovery is taking place in major economies leading to increasing demand especially from fast growing economies like China which expanded 8.9% in the third quarter.

Philippines economy released the GDP reading for the third quarter which showed growth slowed to 1.0% from prior expansion by 2.4%, and it came less than analyst’s estimates of 1.3%. Despite economic growth slowed, the government efforts helped to support the economy to revive through the worst financial crisis since the great depression that affected global demand and the nation’s exports which account for half of the economy.

The MSCI Asia Pacific Index ended Friday’s trading by falling the most since August 17 by 3.0% to 114.00. Nikkei 225 ended Friday’s trading by falling the most since march 30 by 3.22% or 301.72 closing at 9081.52 points, the lowest since July 13. For this week Nikkei dropped by 4.4%. The S&P/ASX 200 closed on Friday at 4572.10 after falling by 2.90% or 136.50 points. Hang Seng ended Friday’s trading by falling the most since March 9 by 4.84% or 1075.91 points to close at 21134.50, on the week the index was down 5.9%.