The only significant change was the upgrade of the export situation to “flat” as opposed to “weakening”. This mediocre statement failed to save the yen as a separate report on international securities transactions over the week of May 8-14 revealed that net foreign purchases of Japanese stocks moved into the red with -¥36.5B from a figure of ¥67.0B in the previous week. Meanwhile, domestic investors bought a net of ¥156.4B worth of foreign securities. Including stocks, bonds and notes, as well as money market instruments, this would be the 5th consecutive week where Japan registered a net capital outflow in terms of portfolio investment. On average, ¥657.3B has been leaving the country each week over the past five weeks. Combined with a “flat” outlook for exports, this is not a good trend in terms of the impact on the currency. Fortunately for the yen, yesterday’s Hong Kong Monetary Authority’s announcement of a widening of their currency peg is lending its support as it potentially represents Hong Kong’s preparation for an upcoming revaluation from China. On the other hand, South Korean authorities said that yesterday’s statement from the governor was misunderstood when it was interpreted to mean that there would be no further intervention or foreign reserve accumulation from the country. Reportedly, the central bank bought dollar-denominated assets as recently as this morning.