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Japanese PM Shinzo Abe told his fellow LDP party members that he is calling a snap elections in the world’s No. 3 economy and that the next hike of the sales tax is delayed. The sales tax is set to be delayed by 18 months, which puts it at April 2017 instead of October 2014. A fiscal stimulus program is also on the cards. The election date is probably going to be December 14th, which is Sunday in less than 4 weeks time.

Update:  Abe knocks USD/JPY from 117- just some stop hunting?

There was incessant talk about this in recent weeks, but the actual news also has an impact, with USD/JPY rising to a high of 116.88. Update: USD/JPY touches 117 and doesn’t break the line for now.

The press conference is due for 10:10 GMT, but the news is basically out.

The Japanese economy slipped into an official recession with the huge disappointment in Q3 GDP, which contracted instead of rebounding after the  second quarter that was marred by the tax hike from 5% to 8%, that ground the economy to a halt.

Dollar/yen is trading at levels last seen in 2007, with analysts competing between them at forecasting high levels for the pair at the end of 2015 and 2016.