Japan

CountryDateEvent TypeMarket EventContextMarket ReactionIndicatorOpenClose
Japan31 March 2023ECONDATAFeb Unemp rate 2.6% last 2.4%
Feb Retail Sales YoY 6.6% last 5%
Feb Industrial Prodn MoM Prelim 4.4% last -5.3%
Feb Industrial Prodn YoY Prelim -0.6% last -3.1%		Lunar NY not only skews Chinese data but also trading partners. Industrial Prodn and Retail sales > exptd.USDJPY traded in narrow ranges though ending higher for the day.USDJPY132.6300132.7200
Japan29 March 2023TALKBOJ Uchida: Wont foretell mkts on information ahead of every MPC meeting. BOJ will look at current policy including YCC and amend if necessary.
BOJ Kuroda: Japan closer than before to sustainably hit 2% inflation target. Wage pressure is heightening.
PM Kashida: Aiming to narrow wage gaps between Japan and overseas. Wage hikes will be one of 3 pillars of new capitalism.
To add Fitch also affirmed Japan’s ‘A’ rating with stable outlook. End of fiscal year flows drags down JPY + banking failure fears abate. Uchida’s amending YCC talk weighed on the JPY as well.USDJPY touched highs of 132.89 as JPY bears brunt of risk rally.USDJPY

JP 10 year yields		130.81

0.287%		132.85

0.301%
Japan24 March 2023ECONDATAFeb CPI YoY 3.3% last 4.3%
Feb Core CPI 3.1% last 4.2%

Mar PMI Flash:
Services 54.2 last 54
Manufacturing 48.6 last 47.7
Composite 51.9 last 51.1		CPI lowest since last Sep. Off 41 year high previous month, but still > 2% BOJ target.

On PMI, growth continues to be strong in services but struggles with manufacturing. 		JPY strneghtns for the day and USDJPY breaches 130 level to lows of 129.63USDJPY

JP 10 year yields		130.77

0.289%		130.71

0.26%
Japan22 March 2023TALKMatsuno: Will allocate more than JPY 2 trln to cushion blow to economy from ↑ prices.
Fin Min Suzuki: Financial system stable, will use reserve funds to respond to prices flexibly. Important for Forex to move stably reflecting fundamentals. 		Moves driven mainly by USD on Fed’s dovish hike.USDJPY ↓ – JPY among the top performers and JP yields strengthened.USDJPY

JP 10 year yields		132.47

0.26%		131.36

0.32%
Japan20 March 2023CENTRALBANK

TALK		BOJ Summary of Opinions: Board memebrs saw need to maintain ultra loose monetary policy, economy showing signs of +ve cycle.

Chief Cabinet Sec Matsuno: Financial system is stable as a whole.
Mkts overall muted.JPY moves still defined by safe haven flows. USDJPY touches lows of 130.58 – lowest since Feb 11.USDJPY131.8000131.3100
Japan17 March 2023TALKFin Min Suzuki: Prices are weighing on households, need to respond to inflation with additional measures. In talks with BOJ, taking response to financial situations.
BOJ Kuroda: Possible to further lower short term rate from -0.1% but cannot comment.
Top FX Diplomat Kanda: Govt, BOJ must take seamless response to market moves.
All moves linked to banking crisis, related risk aversion.JPY emerges as winner on the back of safe haven flows and risk aversion.USDJPY

JP 10 year yields		133.71

0.30%		131.83

0.285%
Japan16 March 2023ECONDATAJan Industrial Prodn Final
YoY -3.1% last -2.4%
MoM -5.3% last 0.3%		Focus on banking crisisJPY becomes an outperformer on risk aversion, safe haven flows. USDJPY touches lows of 131.71USDJPY133.3700133.7100
Japan15 March 2023CENTRALBANKBOJ Meeting Minutes: Important to continue with easing, members agreed economy exptd to recover. Inflation likely to slow toward latter half of next fiscal yr.Dovish minutes, but lacked surprises.USD yields are up despite rising odds for smaller hike on SVB updates.USDJPY

JP 10 year yields		134.21

0.29%		133.37

0.33%
Japan10 March 2023CENTRALBANKBOJ keeps rates and policy unchanged – Rate at -0.1% and 10 year JGB target at 0%, band at 0.5%
BOJ Statement: Economy exptd to recover as impact of pandemic, supply constrains fade. Wil keep balance of commercial paper around JPY 2 trln.
BOJ Kuroda: Wont hesitate to ease monetary policy further if necessary. +ve effects of easing far exceeded side effects. 		Kuroda’s last meeting maintains dovish stance, and Ueda was approved.All as exptd, no big moves from this as mkt was expecting NFP. JPY strengthened for the day, while JP yields ↓ considerably. USD begins slide on SVB issue.USDJPY

JP 10 year yields		136.12

0.501%		135.06

0.406%
Japan08 March 2023ECONDATAQ4 GDP Final QoQ 0%, last -0.3%Continues to be flat despite fiscal and monetary stimulus. All eyes on BOJ meeting.JPY weakens and USDJPY closes higher for the day but within narrow range.USDJPY137.1300137.2900
Japan03 March 2023ECONDATAJan Unemp rate 2.4% last 2.5%
Feb Tokyo Core CPI YoY 3.3% last 4.3%
Feb Services PMI Final 54 last 52.3
Feb Comp PMI Final 51.1 last 50.7

Fin Min Suzuki: Govt will accelerate implementation of measures adopted by extra budget to cope with energy and food price hikes. 		Tokyo inflation data exceeded BOJ target for 9th month but core decelerated from 42 yr highs.

Softer risk tone broadly, more dovish $ talk and US/JP long term rate differential all impacting USDJPY. 		USDJPY for One of the largest weekly losses as US yields also retrieat from highs.USDJPY

JP 10 year yields		136.75

0.504%		136.12

0.503%
Japan02 March 2023ECONDATA

TALK		Feb Consumer Confidence 31.1 last 31
Jan Unemp rate 2.4% last 2.5%

BOJ Takata: Inflation higher due to rising raw material costs, but Japan not yet experienced sustained price increases accompanied by wage increases. 		Dovish talk.10 year yields continue to breach 0.5% range, while USDJPY breaches 137 level to highs of 137.10USDJPY

JP 10 year yields		136.13

0.50%		136.75

0.50%
Japan01 March 2023ECONDATA

TALK		Feb Manufacturing PMI Final 47.7 last 48.9

BOJ member Nakagawa: Easy monetary policy important for the time being. Aiming for +ve economic cycle accompanied by higher wages.

Dovish BOJ (Ueda and Uchida also stressed need for loosers policy) and weaker PMI data (shrinks most in 2.5 yrs).Undermines JPY, elevated USD yields also adds to USDJPY bulls.
USDJPY136.1100136.1300
Japan27 February 2023ECONDATAJan Retail Sales YoY 6.3% last 3.8%, MoM 1.9%
Jan Industrial Prodn YoY Prelim -3.1% last -0.8%
Jan Industrial Prodn MoM Prelim -4.6% last -0.3%		This in addition to Ueda’s continued comments.Flucuations in USDJPY between narrow ranges though staying above 136.00 level.USDJPY136.3900136.1200
Japan24 February 2023ECONDATA

TALK		Jan Inflation rate YoY 4.3% last 4%
Core Inflation rate YoY 4.2% last 4%

BOJ Gov Nominee Ueda: Current policy appropriate to achieve 2% inflation target. Inflation backed by higher import prices and not domestic demand and labour cost index, both of which are weak. Weak JPY good for exports, inbound tourism and some service sectors. If Price target is met, rate of bond purchases will slow. 		Refrained from discussing specifics of YCC for now. Disappointingly, sounded very similar to Kuroda.USDJPY showed good volatility over the talk, but eventually JPY lost out to USD that spiked for the day (see above).USDJPY134.6800136.4600
Japan21 February 2023ECONDATA

TALK		Feb Flash PMI
Manufacturing 47.4, last 48.9
Services 53.6 last 52.3
Composite 50.7 last 50.7

BOJ Kuroda: Wage growth likely to accelerate as companies ↑ pay to compensate for inflation and cope with intensifying labour shortage/ 		Services at 8 mnth high – 6th successive month of expansion and fastest since June 2022. But manufacturing – 4th consecutive contraction month, steepest since Aug 2020.

Overall, mixed data and hawkish talk. 		Struggles to justify hawkish comments and USDJPY touched highs of 135.22.USDJPY

JP 10 year yields		134.17

0.501%		134.99

0.505%
Japan15 February 2023ECONDATAJan Exports YoY 3.5% last 11.5%
Imports 17.8% last 20.7%
Trade Balance JPY -3.49trln, last -1.45 trln		Record trade balance/deficit > JPY 3 trln for first time, as one off factors including Lunar NY dragged on exports. Weaker JPY and higher oil key drivers to trade deficit.USDJPY ↑ also on $ strength on strong data.USDJPY133.1134.1400
Japan14 February 2023ECONDATADec Industrial Prodn YoY Final -2.4% last -0.9%
Kazuo Ueda to be next BOJ Gov. 		volatility in JPY on the back of Gov appointment.volatility in JPY on the back of Gov appointment.USDJPY132.36133.11
Japan13 February 2023ECONDATAQ4 GDP QoQ Prelim 0.2% last -0.3%$ driven moves in anticipation of US CPI and BOJ Gov nomination.USDJPY131.11132.36
Japan10 February 2023TALKFin Min Suzuki: Pulling economy out of deflation and achieving stable growth remain main challenge.
BOJ Amamiya: Don’t see need to make YCC more flexible. 		For now, BOJ continues to see 2% inflation target. Reports also Kazuo Ueda to be next BOJ Gov – speculations high inflation would lead to a more hawkish stance.Big ↓ in USDJPY following news of Kazuo as next BOJ Gov. Breached 130 level to lows of 129.79USDJPY131.5300131.4100
Japan01 February 2023ECONDATAJan Final Manufacturing PMI 48.9 as exptd and last.Contracts (<50)for 3rd straight month, 1st time it has not fallen since Apr. Subdued global economic conditions held back demand in JP's mfg sector.$JPY in exceptionally narrow range.USDJPY130.0500128.9000
Japan30 January 2023ECONDATA
TALK		Dec Unemp rate 2.5% as exptd and last
Dec Industrial Prodn YoY Prel -2.8% last -0.9%
Dec Retail Sales MoM 1.1% last -1.3%
BOJ Kuroda: Uncertainty re Japan’s economy is extremely high. Important to support economy and create an environment where companies can raise wages. 		Seperately, there is an urge for BOJ to make 2% inflation target a long term goal. This lead to knee jerk JPY strength.FX markets broadly quiet awaiting Central banks. JPY is a bit strong. USDJPY between ranges ofUSDJPY

JP 10 year yields		129.75

0.47%		130.32

0.48%
Japan24 January 2023ECONDATAJan Flash PMI
Manufacturing 48.9, last 48.9
Services 52.4 last 51.1
Composite 50.8 last 49.7		Mixed data + chatters PM’s plans to ease legal status of COVID to class 5 disease.Downside pressure on USDJPY, breaches 130.00 level to ,lows of 129.72. Minor gains on JPY against firmer USD.USDJPY

JP 10 year yields		130.64

0.378%		130.1

0.406%
Japan19 January 2023ECONDATADec Inflation rate YoY 4% as exptd, last 3.8%at 41 year high, much of the price growth from ↑ food prices, gas rates. Mkts expecting revisions to YCC under new BOJ Gov (Apr).USDJPY touched highs of 128.88 but closed lower.USDJPY128.8500128.4000
Japan18 January 2023ECONDATADec Exports YoY 11.5% exptd 11% last 20%
Dec Imports YoY 20.6% exptd 21% last 30.3%		Exports grew at slowest rate in 2022. Extends trade deficits to 17 straight months.Unrelated to data, $JPY corrected after spike on BOJ, and 10 year yields between ranges of 0.504% and 0.362%
USDJPY

JP 10 year yields		128.05

0.504%		128.85

0.426%
Japan18 January 2023CENTRALBANKBOJ Rate decn: Maintains key short term rate at -0.1% and 10 yr bond yields around 0%, keeps +/-0.5% range for 10 year yields.
BOJ Kuroda: Do not see need to widen the oft-discussed bond yield cap, yields expected to normalize back below this level. 		Defies mkt speculation of tweak to yield control range. Of note that BOJ has bought so much 10 JGBs, liquidity has dried up.JPY feels the heat, and 10 year yields too ↓ sharply. USDJPY touched highs of 131.54.
10 year yields low at 0.362%		USDJPY

JP 10 year yields		128.05

0.504%		128.85

0.426%
Japan11 January 2023EVENTReport – BOJ will review side effects of easy policy next week.Pevious roumours of change to policy validated by ‘tweak’ in YCC. This is more of the same.USDJPY continues to be under pressure brushing to lows of 132.06 before closing higher.USDJPY

JP 10 year yields		132.23

0.502%		132.47

0.501%
Japan02 January 2023TALKBOJ Kuroda: BOJ will continue monetary policy easing to achieve price target in tandem with wage growth.
Nikkei Asian Review: PM Kishida – will discuss whether to rework the inflation target with the new BoJ Gov/. 		Nikkei review is on a hawkish note. $JPY moves $ driven and awaiting FOMC minutes and ISM.BOJ comment not really weighing on JPY though JPY closed slightly stronger.USDJPY131.1000130.6000