Talking Points:
- Japanese industrial production figures for January were revised substantially higher
- The preliminary release badly missed expectations
- The Japanese Yen had been rising before the data, and continued to do so after publication
The Japanese Yen extended its mini-rally against the US Dollar Wednesday after official Japanese industrial production figures were revised for the better.
Production is now thought to have fallen 0.4% on the month in January. Obviously that’s not great but it is much better than the 0.8% fall previously reported. Compared with January 2016 production is now up 3.7%, beating the preliminary estimate of a 3.2% rise.
Initial figures were released on February 28 and missed market expectations badly. This latest revision makes the month’s production look a little better, but that on-month decline was the first for six months. Falls in cars for export to the US have been cited as the largest main contributor to this.
The Yen had been rising against the greenback for a couple of hours prior to the release. USD/JPY seems to have topped out at 114.883 for the Asian session and had been retreating steadily if unspectacularly from that point before the data. It was at 114.776 just afterward
Already sliding: USD/JPY
The USD/JPY market like all others is focused on Wednesdays’ monetary policy decision from the US Federal Reserve, almost to the exclusion of all else. This is widely expected to include an interest-rate increase and, perhaps, some clues as to how many more there might be.
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--- Written by David Cottle, DailyFX Research
Contact and follow David on Twitter: @DavidCottleFX
