Asian Session Forex Recap – Jan. 30, 2015

  • Japan’s national core CPI down from 2.7% to 2.5% in Dec
  • Tokyo core CPI fell from 2.3% to 2.2% in Dec
  • Japanese household spending showed 3.4% decline y/y vs. estimated 2.3% drop
  • Japan’s jobless rate improved from 3.5% to 3.4%
  • Japanese preliminary industrial production up by 1.0%
  • Australian PPI showed 0.1% uptick for Q4 vs. projected 0.3% increase
  • Euro zone CPI flash estimates to show more weakness?

Today’s data dump from Japan showed further weakness for the world’s third largest economy, as falling oil prices continued to weigh on inflationary pressures. The national core CPI slipped from 2.7% to 2.5%, marking its fifth consecutive monthly decline, while the Tokyo core CPI dropped from 2.3% to 2.2% in December.

Household spending was also dismal, as the report indicated an annualized 3.4% decline versus the projected 2.3% drop. Industrial production posted a 1.0% gain for the previous month, short of the estimated 1.3% increase.

The only piece of positive data was the jobs report, which indicated that the unemployment rate improved from 3.5% to 3.4% in December. Yen pairs gapped down after these reports were released, as the Japanese currency seemed to react to risk aversion. USD/JPY is down 33 pips (-0.29%), EUR/JPY is lower by 21 pips (-0.16%) and GBP/JPY is down 41 pips (-0.22%).

Australia also had a top-tier report released today in the form of its quarterly PPI. The report posted a mere 0.1% uptick in producer prices, lower than the estimated 0.3% increase. Despite that, AUD/USD is up 0.32% and AUD/JPY is up 0.02%.

All eyes will be on the euro in the next few hours, as the forex calendar shows that there are a bunch of medium-tier reports due from its top economies. Germany and France are set to release their consumer spending reports while Spain will print its preliminary CPI and flash GDP reading. Euro zone flash CPI estimates are also due, with the headline figure likely to print a 0.5% decline and the core figure slated to show a 0.6% increase. Stay on your toes!

U.S. Session Recap

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