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29 Mar 2013
Forex: USD/JPY slides to 93.96 session lows on disappointing domestic data
FXstreet.com (Barcelona) - USD/JPY is currently trading still above the 94.00 handle at session lows around the 94.12, following disappointing economic data coming out of Japan, showing deflation strongly persisting at a -0.7% pace for the month of February on the overall nationwide count, the lowest since mid 2010. For the core Tokyo on a yearly basis number showed a -0.5% decline in prices, slightly above expectations at -0.6%, but still in the negative sin early 2009.
The other upset came from the big miss over expectations in the Japan industrial output preliminary figure for the month of February coming in at -0.1% when economists surveyed had anticipated an increase of +2.6%, also showing a negative figure for eight consecutive month. Unemployment also modestly rose to 4.3% from previous and estimated 4.2%.
Now all eyes point for next BoJ meeting on April 04 and what Kuroda can do to turn that long term deflationary trend, that only saw a 2% rate in CPI back in 2008, and only for a very short period of time. Currently average of last 16 years, measured as a 200 monthly SMA on the overall nationwide CPI, reads at -0.08%, with a clear hurdle since late 1990 at the +0.6% rate.
While writing these lines USD/JPY has accelerated the decline on a broad USD selling move, printing fresh session lows at 93.96, down -0.36% for the week so far, ahead of monthly close today in Asia-Pacific, with almost all markets closed over holiday but Japan and mainland China. The Nikkei index trades flat for the moment around the 12400 points mark, while SP500 index in the US posted a record all time high at 1569.
Immediate support to the downside for USD/JPY lies at recent session lows 93.96, followed by yesterday's London session/Tuesday's lows at 93.85, and Monday's fresh 3-week lows at 93.50. To the upside, closest resistance shows at March 22 lows 94.20, followed by recent session highs at 94.30, and yesterday's highs at 94.40.
The other upset came from the big miss over expectations in the Japan industrial output preliminary figure for the month of February coming in at -0.1% when economists surveyed had anticipated an increase of +2.6%, also showing a negative figure for eight consecutive month. Unemployment also modestly rose to 4.3% from previous and estimated 4.2%.
Now all eyes point for next BoJ meeting on April 04 and what Kuroda can do to turn that long term deflationary trend, that only saw a 2% rate in CPI back in 2008, and only for a very short period of time. Currently average of last 16 years, measured as a 200 monthly SMA on the overall nationwide CPI, reads at -0.08%, with a clear hurdle since late 1990 at the +0.6% rate.
While writing these lines USD/JPY has accelerated the decline on a broad USD selling move, printing fresh session lows at 93.96, down -0.36% for the week so far, ahead of monthly close today in Asia-Pacific, with almost all markets closed over holiday but Japan and mainland China. The Nikkei index trades flat for the moment around the 12400 points mark, while SP500 index in the US posted a record all time high at 1569.
Immediate support to the downside for USD/JPY lies at recent session lows 93.96, followed by yesterday's London session/Tuesday's lows at 93.85, and Monday's fresh 3-week lows at 93.50. To the upside, closest resistance shows at March 22 lows 94.20, followed by recent session highs at 94.30, and yesterday's highs at 94.40.