The Japanese yen weakened against the US dollar as the Bank of Japan’s Tankan surveys showed a weaker large manufacturing outlook for the first quarter. Although the BoJ has established additional support for the sector, traders are expecting additional easing support in the coming months. The surveys, sent in early March, should have taken into account effects of the weaker yen.
|
GMT |
Bank of Japan-Tankan Surveys (1Q) |
ACT |
EXP |
PREV |
|
23:50 |
Large Manufacturers (Current) |
-4 |
-1 |
-4 |
|
23:50 |
Large Manufacturers (Outlook) |
-3 |
2 |
-5 |
|
23:50 |
Non-manufacturing (Current) |
5 |
5 |
4 |
|
23:50 |
Non-manufacturing (Outlook) |
5 |
6 |
0 |
|
23:50 |
Large All-Industry Capital Expenditures |
0.0% |
0.8% |
1.4% |
The Japanese yen weakened immediately after the US dollar after the Tankan reports as the weaker large manufacturing sector, dependent on exports to other countries, open up speculation to additional easing by the Bank of Japan. Although the Bank of Japan has established a 1% CPI target in February and additional support for domestic industries, current austerity debates in the government places the bank as the only other candidate monitoring the strengthen of the yen.
-Data Bloomberg
At the time of writing, the Japanese yen is trading at 83.000 levels, lower by 0.230% since this morning’s open. The gap higher in USDJPY quotes this morning was due to higher than expected Chinese manufacturing PMI, sparking an initial move towards higher yielding currencies.
USDJPY 5 minute chart. Vertical line indicates time of Tankan release. Charts FXCM Strategy Trader.
-- By David Liu, DailyFX Research
