Yen bears were in control this week as broad risk sentiment turned positive and net negative Japanese updates likely didn’t help.
Japanese Headlines and Economic data
- Global risk sentiment started off positive this week, likely due to the news of stimulative efforts from the People’s Bank of China to support the likely hit China will take due to the Coronavirus outbreak. Risk-on sentiment accelerated on Tuesday to send the yen further lower against the majors, most likely on news that a vaccine for the Coronavirus is ready for testing.
- BOJ signals readiness to ease as virus impact clouds outlook
- Japan Service sector activity recovers in January to 51.0 vs. 49.4 in Dec.
- We can see a spike lower in the Japanese yen during the Wednesday session, possibly related to the news of a breakthrough in the race for a vaccine by a British scientist.
- Japanese workers took home lower wages in 2019
- Japan household spending falls more than expected in December
- Coronavirus related fears sent risk sentiment back to the negative on the Friday session on news that 41 passengers on a cruise ship quarantined off Yokohama test positive for coronavirus, and concerns the outbreak will do much more economic damage to China than previously anticipated. The Japanese yen was able to rally on the reversal of sentiment, but not enough to get back into net green for the week.