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It was a choppy week for Japanese yen traders as improving economic updates from Japan mixed with pandemic worries, risk sentiment and counter currency influences.

Overlay of Inverted JPY Pairs: 1-Hour Forex Chart
Overlay of Inverted JPY Pairs: 1-Hour Forex Chart
JPY Weekly Performance from MarketMilk
JPY Weekly Performance from MarketMilk

Japanese Headlines and Economic data

Monday:

Japan’s GDP fall of 2.2% in Jan.-March unchanged in revised data

Japanese Manufacturing production falls at slowest pace since February

After Asia and London session strength, the yen fell during the U.S. trading session, possibly on rising positive risk sentiment thanks to broad U.S. equity strength (once again lead by the tech sector) and/or positive coronavirus news (Eli Lilly starts late-stage study of coronavirus drug in nursing homes)

Tuesday:

Tokyo core CPI up from 0.2% to 0.4% vs. projected 0.2% uptick

Japan Monetary Base increases 9.8% y/y in July vs. 6.0% in June 

Wednesday:

The yen broadly fell during the Asia session, possibly on rising global risk sentiment sparked by positive economic updates from the region (New Zealand unemployment at 4% in surprise fall during coronavirus pandemicAustralia’s services activity recovery gathers pace in JulyCaixin: China’s service sector growth sustained at market rate in July)

BOJ’s Kuroda warns of renewed constraints on Japan economy from pandemic

 

Thursday:

No major catalysts from Japan on the session, so the move lower during the U.S. session may have been on positive global risk sentiment (possibly ignited by the better-than-expected U.S. initial jobless claims?)

Friday:

Japan real wages fall for fourth straight month in June

Japan’s household spending recovers in June

Japan’s coincident index rises 3.5 points in June

The Japanese yen rallied broadly during the Friday session (with exception against the Greenback). On top of the positive updates from Japan, JPY likely saw support on rising risk aversion sentiment as tensions rise between the U.S.-China grow and the U.S. government fails to agree a new stimulus package deal.