Yen Improves as Capital Spending Data Trounces Analysts' Expectations
THE TAKEAWAY: Japanese Capital Spending Jumps to 7.6 percent from -9.8 percent > Increase Outperforms the Market’s Expectation > USDJPY currency pair drops
Japanese fourth quarter capital spending rose 7.6 percent following a 9.8 percent decline the previous month, besting expectations of a 6.5 percent decline. The positive figure indicates a potential unexpected rebound in growth as corporations in Japan invest more in their businesses.
Analysts did not expect an increase in capital spending this month, and this reflects the series’ biggest increase since March 2007. As traders balanced their portfolios in response to the unforeseen change in capital expenditures, the USDJPY fell, hitting troughs as low as 81.130.
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