Forex: USD/JPY – Yen weakens against USD on Marine Day
The dollar started to rise against the yen in the first hour of the European session today, after the pair had traded in the mid-99 range in Tokyo trade earlier. Generally speaking, Japanese markets were quiet on account of the national Marine Day holiday. At the London opening, the pair was at 99.57.
The yen has been weakened by China’s second quarter GDP reading, released Sunday and showing that economic growth slowed as expected to 7.5 percent on an annual basis, from 7.7 percent in the previous quarter.
Quarter-on-quarter, GDP expanded 1.7 percent, from 1.6 percent in the last quarter of 2012 and below the expected 1.8 percent.
According to the monthly China Securities Journal, June’s industrial output fell 8.9 percent y/y, against 9.1 percent forecast and 9.2 percent in May.
Chinese Retail sales rose 13.3 percent in June y/y, versus 12.9 percent forecasted and previous. Fixed asset investment (non- rural) for June y/y was down at 20.1 percent from 20.4 in May and just below expectations for 20.2 percent.
Last week, the Bank of Japan decided to keep its monetary easing programme unchanged and raised its assessment for the economy by using the word “recover” for the first time in more than two years.
In its statement the BoJ said: “With regard to the outlook, Japan’s economy is expected to recover moderately on the back of the resilience in domestic demand and the pick-up in overseas economies.” The central bank also pointed to a rise in business and public investment, private consumption and industrial production, and noted that exports were also improving.
There were no changes to the BoJ’s forecast that consumer inflation will accelerate to two percent in the fiscal year ending March 2016, though the prognosis for core consumer inflation for the year to March next was trimmed from April’s 0.7 percent to 0.6 percent, reflecting the impact of falling commodity prices.