“Gimme your lunch money and it better be in yen! Or else…” The Japanese officials once again became the pip-bullies when the yen weakened across the board on their comments of “taking appropriate action” on the yen’s rapid decline. USDJPY jumped back up by 54 pips from its open price at 84.71, while EURJPY scurried to a 107.15 close after opening 49 pips lower.
The shaky economic data from the US should have boosted the safe-haven currencies like the yen, but another round of jawboning from the BOJ officials kept the yen bulls at bay. They suggested that the central bank is considering further quantitative easing to support a weak yen, and that currency intervention is still an option.
Will the yen need more bullying to keep the bulls away? No report was released from Japan yesterday, but keep your eyes on Tokyo’s core CPI out at 11:30 pm GMT. The annualized figure for August is expected to decrease by 1.2%, but a bigger decline could spell more trouble for the country’s deflation problems.
Speaking of deflation problems, the annualized household spending report will also be revealed at 11:30 pm GMT. Spending in July is estimated to rise by 1.5% after June’s 0.5% growth, but a higher rate can signal that demand continues to chug despite a weak currency.
Pip-a-boo! Thanks to the lingering presence of risk aversion in the market, the yen was able to spook the bulls and snatch 29 pips from the dollar when USDJPY closed at 84.41. However, there wasn’t enough negative vibe in the market yesterday for it to scare pips out of the higher-yielding currencies. Boo!
Rumors of a BOJ intervention have kept the yen from going all Pipzilla against the dollar. Hmm, I wonder how the mixed reports yesterday will fit in all that anti-strong-yen talk. Let’s look at them, shall we?
Inflation in Tokyo printed a softer decline of 1.1% in August than the forecast which was at -1.2% and the national CPI printed as expected for the month at -1.1%. Yey! Adding more good news was the unemployment rate which came in lower than the 5.3% figure that analysts had braced for. It printed at 5.2% for July. Woot woot!
However, household spending in July fell short of the consensus when the index printed a puny 1.1% growth rate when the consensus was up at 1.5%. Uh oh…
Our economic calendar is blank of reports from Japan but may I suggest that you keep tabs on reports from its counterparts and the Jackson Hole Symposium. If these spark risk aversion, we may just see the yen scare the pips out of its counterparts again!
Unlike T.I. who has Keri Hilson to back him up, the yen didn’t have anything or anyone last Friday as risk aversion seemed to have been on the down low and policymakers continued their jawboning. USDJPY closed higher at 85.36 giving the yen a 94-pip loss. Boo hoo!
The not-so-awful revision to the US’s GDP figures and the BOJ’s intervention threats might have been enough reason for traders to dump the yen. Tsk, tsk…
I wonder if today’s reports will be enough for the bears to serenade the yen with “Got Your Back” and get it rollin’ in pips! At 11:50 pm GMT, we have Japan’s preliminary industrial production figures for July. Analysts are wide-eyed and hopeful for an improvement with the -0.3% consensus better than June’s -1.1% reading. Along with that we also have the retail sales data. The market is expecting to hear that the Japanese did more shopping in July with the forecast at 3.5%, 0.2% higher than June’s figure.
Did you see that awesome blockbuster in your charts yesterday? “The Lord Of The Pips: The Three Towers” captivated the markets yesterday as the yen gained on its major counterparts after the BOJ’s announcement. USDJPY peaked at 85.91 before tumbling down to 84.56, and EURJPY climbed all the way to in intraday high of 109.56 before dropping to 107.08. Meanwhile, GBPJPY fell to a 130.72 close after rising to as high as 133.62.
Does this mean that unlike Frodo and Sam in the epic trilogy, the Bank of Japan did too little and was too late in fighting the yen’s rapid appreciation? Market geeks seem to think so!
Yesterday the BOJ announced that they would add 10 trillion JPY to their quantitative easing program and introduce a 6-month credit package in addition to the existing 3-month platform with a 0.1% interest rate.
While many think that this would have more impact on their economy than a direct currency intervention, others believe that it won’t do much to temper the yen’s gains against its major counterparts. Don’t ignore the possibility of an intervention, though, because many still say that the BOJ just might launch one if the new stimulus fails to get a round of applause from investors.
Meanwhile, production data from Japan showed mixed results, with the manufacturing PMI dropping to 50.1 from July’s 52.8, but industrial production in July rose to 0.3% from June’s 1.1% decline.
Annualized retail sales, too, showed a positive surprise when it printed at 3.9% after analysts already pegged the number at 3.6%.
Will the data today continue to show mixed results? Annualized cash earnings in July just came hot off the press, printing at 1.3%, down from June’s 1.8% but higher than the expected 0.9% growth. Hmm, will the housing starts at 5:00 am GMT also show an upside surprise? The figure is expected to grow by 2.5%, but a better figure just might put a smile on the investors’ faces. Don’t miss this one!
Oh, how traders love the yen! No matter how far the currency retraces, traders and investors always seem to find some reason to buy it back up. We saw this yesterday, when the yen found itself rallying furiously across the charts, particularly against the pound.
With the Quantitative Easing Part 2 plaguing the dollar and the possibility of intervention from the BOJ highly unlikely, it looks like the yen is the preferred currency among investors.
Nothing on Japan’s economic cupboard today, so keep an ear out for comments from BOJ officials… One peep out of them regarding intervention give the yen crosses a major boost!
After two consecutive days of wins, the yen decided to take it easy yesterday and give back some of its gains. It fell against most major currencies when optimistic economic data from China and Australia that printed early in the day inspired risk appetite among investors. EURJPY reached a high of 108.62 before settling at 108.16 by the end of the US trading session.
Apparently China’s manufacturing PMI was reported to have rebounded to 51.9 from 49.4 while Australia grew 1.2% during the second quarter of this year, higher than expectation and an improvement from the revised up 0.7% the quarter before.
Time to sell the yen? Hah, not so fast; we all know how fickle traders are! If there’s one thing we have seen in the past weeks, it is that traders always seem to find a reason to buy the yen up. This relief rally might just serve as a chance for traders to buy the yen at cheaper levels.
No important data coming out Japan again today, so the yen’s price action will most likely be driven by news coming out of other major economies, especially the US and euro zone.
Did the yen bulls and bears go on mini-hibernation in preparation for the US NFP report today? The yen inched higher against most of its major counterparts, with USDJPY capping the day with a 21-pip slide at 84.23 and EURJPY closing 15 pips lower at 108.01.
The quarterly spending data released a few hours ago might wake them up after the capital expenditures made by businesses clocked in at only a 1.7% decrease after falling by 11.5% in the first quarter. Hmm, is it time to for another yen-buying session?
No other economic data is scheduled from Japan today, but keep an eye out for the big NFP data from the US. The report usually excites the currency pairs like sugar rush in a kindergarten school, so watch your trades closely!
“Oh when it all, it all falls down…” The yen did an Alicia Keys number last Friday after the improved risk sentiment in markets and the political hullabaloo in Japan pushed the yen lower against most of its major counterparts.
USDJPY capped the week at 84.42 after rocketing to an intraday high of 85.23 a few minutes after the NFP report from the US was released. Meanwhile, EURJPY soared by 85 pips from its open price at 108.85.
No economic report was released from Japan last Friday, but Ichiro Ozawa, a strong competition for Naoto Kan as Japan’s PM, made a lot of noise about the yen’s rapid appreciation and its undesirable impact on the Japanese economy. Many market junkies believe that we are in for a few radical changes in the BOJ’s policies and its involvement in Japan’s economic development if Ozawa wins the election this September 14.
While we wait for Japan to decide on its PM, we entertain ourselves with the BOJ’s monetary policy statement tomorrow followed by a press conference at 11:00 pm GMT. Analysts expect the interest rate to remain at 0.10%, but we might get a few clues on the BOJ’s next moves in addressing the impact of the strong yen on the Japanese economy.
The core machinery orders will also hit the pip-stage tomorrow at 11:50 pm GMT. Analysts are betting on a 2.0% growth in July after June’s 1.6% figure, but a better-than-expected number might help the investor confidence in Japan.
Things are about to get interesting in the Land of the Rising Sun, so don’t miss out on these reports!
Because of the lack of market players yesterday, the yen was forced to settle for stalemates against its biggest rivals. USDJPY rose just 5 pips, while EURJPY fell 9 pips, and GBPJPY dropped 18 pips for the day.
With no big reports hitting the markets, traders had a hard time getting their boogie on. But maybe they’ll “get jiggy with it” today as Japan is scheduled to publish its core machinery orders data at 11:50 pm GMT. Analysts say July probably recorded a 2.0% growth following the 1.6% increase in machinery orders in June. Yen bulls, keep your fingers crossed for an upside surprise because growing machinery orders often precede greater future production as manufacturers work to fill the additional orders.
Also, stay on your toes because the Bank of Japan is set to make its monetary policy statement today. Even though most are expecting to see rates unchanged at 0.10%, you ought to tune in as the BOJ may hint at future policy moves. Good luck out there, kids!
Rawr! There’s no stopping the Pipzilla of the charts! The yen clobbered its major counterparts to record-lows yesterday as risk aversion sent the traders to the low-yielding currency. USDJPY ended the day at 83.76 after dipping to its 15-year lows at 83.51. Meanwhile, EURJPY dropped all the way to its intraday low at 106.30.
Will the Bank of Japan put a stopper to this pipmonster? In its press conference yesterday the BOJ kept the interest rates at 0.10% and expanded its credit program by 10 trillion JPY. BOJ Governor Shirakawa also said that the BOJ will closely look at the impact of the strong yen, and take necessary actions in a timely manner.
Hmm, does “timely manner” mean “in time for the elections?” Recall that current Prime Minister Naoto Kan is in a tight race against Ichiro Ozawa for the leadership election of the Democratic Party of Japan. If the yen continues to dominate the charts, a currency intervention from the BOJ just might earn a few applauses in time for the election.
The positive economic reports from Japan also helped in attracting the bulls. The currency account surplus widened to 1.46 trillion JPY after printing a 1.46 Trillion figure last June. The core machinery orders also brought home the bacon when it zoomed higher by 8.8% and smacked the modest expectations of 1.9%.
Maybe the BOJ will have more good news today when the BOJ monthly report is released at 5:00 am GMT. The BSI manufacturing index is also scheduled to rock the stage at 11:50 pm GMT, and a number higher than the expected 6.3 figure for the second quarter might give the BOJ more headaches as it could further empower the pipmonster across the charts.
The Bank of Japan must have breathed a sigh of relief yesterday when the yen lost against its counterparts on a rally of risk appetite. USDJPY wormed its way to a 15-pip gain after dropping to an intraday low of 83.34. Meanwhile, EURJPY also tip-toed to a 37-pip rise and closed at 106.69.
It seemed that the markets were more interested in in the euro zone region than on Japan’s better-than-expected BSI manufacturing index report. The data climbed to its 13.3 index figure from 10.0 in the first quarter, and supported the strong current account numbers released yesterday.
Were these good data enough to put smiles on Japan’s citizens? We’ll know today at 5:00 am GMT when the household confidence report is released.
The final GDP report will also make an appearance today at 6:00 am GMT. The reading for the second quarter is expected to pick up to a 0.4% growth after printing 0.1% in its preliminary release a few weeks ago.
The last hurrah for the day will be the BOJ’s monetary policy meeting minutes at 11:50 pm GMT. Though market nerds expect to be bombarded with more of the “closely monitoring the price action” and “timely action” tunes, we might get a clearer picture on the BOJ’s economic sentiment with this report.
Like Gru’s minions in Despicable Me, the yen was seen everywhere across the charts as it lost against the comdolls, and gained on the euro and the dollar. EURJPY leveled off to its 106.50 closing price after dipping to an intraday low of 105.96. Meanwhile, USDJPY inched by only 8 pips lower than its open price at 83.83.
The sentiment on the commodity-related economies and the disappointing reports from Japan added to the hodgepodge of risk appetite yesterday. Japan’s household confidence dropped to its 42.4 figure, and shocked the market geeks who forecasted the number at 43.8. Are the Japanese losing their smiling faces over the threats to their economy?
Good thing the positive machine tool orders for August made up for the sad faces by printing a 170.0% growth against July’s 144.9% growth figure. This supported the positive BSI manufacturing report, and tempered the concerns on Japan’s economic activity.
And this just in! A few Facebook pageviews ago, Japan released its better-than-expected final GDP report. After initially clocking in at 0.1%, it met the analyst expectations of a revised 0.4% figure.
No other report is on deck for Japan today, but keep close tabs on the Bank of Japan’s statements! With all the hullaballoo with the yen and the economy, I hear that even the BOJ is having trouble being consistent with their speeches! Oooh, this is going to be interesting!
After setting a new 15-year high against the dollar, the yen finally gave up some of its gains to end the week. USDJPY managed to end 38 pips higher on Friday, to finish the week at 84.20. The question tickling my funny bone is, will traders just see this as another (cheaper!) chance to buy the yen?
The big news to hit the airwaves and drown out all that Japanese pop music was news that the Japanese government had finalized a new stimulus package to help prop up the Japanese economy. The package is worth approximately 915 billion Yen, and will be used to fight off the effects of deflation and the rapid appreciation of the yen. Right in line with the current government’s goals, the additional stimulus will aim to boost domestic demand and spending.
In other news, a Japanese official spoke out against the recent strength of the yen, this time putting the blame on China! Finance Minister Yoshihiko Noda called out China, questioning its recent yen purchasing. He said that it was unfair that China could buy Japanese bonds, but Japan could not purchase Chinese bonds. Noda even questioned China’s true intentions of buying yen bonds. Ahhh, don’t you love it when you see economic trash talk?!
No biggies coming out this week, but with all the high impact reports coming out from other countries, we could see bursts of volatility. Make sure you know what’s coming out by bookmarking the BabyPips.comeconomic calendar!
Ha! I told you so! Didn’t I say traders will just see Friday’s move as a chance to buy the yen at a cheaper price? After reaching an intraday high of 84.37, USDJPY sold-off like iPADs on opening day to close the US trading session at 83.71.
Earlier today, another round of selling ensued to take USDJPY to new yearly lows. The yen crosses also followed suit and fell, with GBPJPY taking the brunt of the burn.
You’re probably thinking, “What’s causing this move? I don’t see anything important on the economic calendar!” Ah, let me explain.
Apparently, investors are turning to the yen because of the uncertainty surrounding the election of a new Democratic Party of Japan (DPJ) party president. There are currently two candidates for the position, one being Prime Minister Kan, and the other as Ichiro Ozawa. Much support is being given to Ozawa by the former Prime Minister Hatoyama, but surveys show that the DPJ race is still pretty tight.
Keep a close eye on the results of the elections closely folks, as its effect on the yen’s valuation could be huge! Ichiro Ozawa is known as a major supporter for outright FX intervention to weaken the yen, so a victory for him will be a… err, loss for the yen.
King Kong ain’t got nothin’ on the yen! The Japanese currency was simply monstrous on the charts as it forged a new 15-year high against the Greenback. USDJPY was on a steady slope down as it fell 59 pips from its opening price of 83.68.
Prime Minister Kan took the yen along with him when he arose victorious the elections in Japan yesterday. But why?! You see, his opponent in the electoral race, Ozawa, is a well-known supporter of direct market interventions. So basically, traders see Kan’s win as a step towards a more laid-back approach to intervention.
Still, even Kan has his limits and you have to start wondering how long the government will continue to let the yen appreciate. Some say it’s unlikely that the BOJ will allow USDJPY to reach its record low of 79.75.
Will the yen continue to soar or will it decide to give the BOJ a break from all the headaches? Since Japan isn’t publishing any hard-hitting reports today, you ought to keep track of risk sentiment. If risk aversion ensues, the yen could be in for more gains.
Boy, oh boy, am I at a loss for words! You would be too if you saw USDJPY jump over 200 pips in a span of four hours! The pair uncharacteristically sprung to life after the BOJ finally intervened to stop the yen from further appreciation. At the end of the day, USDJPY recorded a solid 250-pip gain as it closed at 85.60.
You’re watching history in the making, folks! Yesterday’s intervention was the first time Japan has stepped in in 6 years. After watching their currency climb up the charts week after week, the BOJ finally said “Enough is enough!” when USDJPY hit 83.00. Analysts estimate that the government shelled out as much as 1 trillion yen for the move.
The BOJ’s move may have caught some investors by surprise since Kan, who was less supportive of an intervention than his opponent, recently won the Democratic Party of Japan elections. But I guess everyone has their limits!
Don’t get too comfy now. The Ministry of Finance says they’re not through with the intervention yet. For now, it’s best that we listen to what BOJ Governor Shirakawa has to say when he takes the stand at the Japanese Brokerages’ meeting at 6:00 am GMT.
It appears like the effect of the intervention-kryptonite hasn’t faded yet as USDJPY traded well above the 85.00 handle all throughout yesterday’s trading. The yen was able to hustle the pair to an intraday low of 85.23, but the dollar took charge during the New York session. USDJPY closed 9 pips higher at 85.83 and so did EURJPY at 112.26, giving the yen an 89-pip loss.
We didn’t have anything on tap for the once-mighty yen but we did hear BoJ Governor Shirakawa talk. He implied that the government will continue its easy monetary policy stance saying that their quantitative easing tricks didn’t do much to boost the economy. Yikes! That doesn’t sound good for the yen. I wonder how that will affect its fate on the charts…
Our economic calendar is still blank for reports from Japan today. But if your planning to place your pips on the yen, remember that earlier this week the BoJ said there’s a POSSIBILITY of it intervening again. So, be extra careful! Good luck and may the pips be with you!
Action on USDJPY was about as flat as a pug’s face. The pair basically stayed within a 30-pip range for the day. USDJPY was practically unchanged last Friday as it closed at 85.80.
With no reports coming from Japan, action was pretty subdued. Yo, do you think them bulls are getting tired? Or are they just taking a breather?
Unfortunately, we’ll have to wait until Saturday to get our first headliner from Japan. At 4:50 pm GMT, BOJ Governor Shirakawa is scheduled to make an appearance. It’s always worthy to see what the guy who calls the shots in the BOJ has to say. So you may want to set aside a few minutes of your weekend to hear him out!
Not much action on USDJPY yesterday. In fact, since yesterday was Respect for the Aged Day in Japan, it was a total doser! USDJPY traded sideways and stayed within a tight range as the pair ended practically unchanged at 85.75.
Throw those sake bottles back in the cupboard! The Japanese bank holiday is over! But it looks like the press didn’t get the memo. We still don’t have any reports due from Japan today! In the meantime, keep risk sentiment in check as a bout of risk aversion may help the yen recover some of its recent losses.
Some say the yen may begin its rebound today. But be careful! If USDJPY drops back below 84.00, the BOJ may step in again.
USDJPY headed south of the charts after opening at 85.75 and closed in favor of the yen at 85.10. Whoohoo! But as of this writing, the pair is already trading below the psychological handle! Am I hearing the bears singing, “Ain’t no intervention can keep us from you”?
The Fed’s dovish statement yesterday might have been enough for traders to short USDJPY despite threats of intervention from the BOJ. Then to make the yen more irresistible, there was the increase in Japan’s leading economic indicator to 100.0 in July from 98.2 in June which implies that we may see more hustle from the Japanese economy in the near future. Oh yeah!
Today we have the all industry activity index for July. It is projected to have increased to 1.0% during the month following its puny 0.1% growth in June. Given the pessimism surrounding the US economy, a better-than-expected figure may just give traders one more reason to root for the yen.
Be careful though! I don’t think Finance Minister Noda just meant monkey business when he said that the BoJ is ready pull the intervention trigger once more. Yikes! I’d look out for the 84.00 handle if I were you.