Yen Crosses Struggle Despite Stock Market Rally

The Japanese Yen crosses struggled despite the rally in US stocks. Japanese industrial production was weaker than the market expected, reflecting the overall problems in the Japanese economy.

Labor cash earnings are due for release tomorrow and even though the market is expecting earnings to rebound, there is a greater chance that it will miss. Looking ahead, we still expect further gains in USD/JPY and consider this latest retracement a hiccup before a move towards 110.