Japan’s first quarter Tankan Large All Industry Capex came out at -0.4%, well below expectations of 1.8% and a previous value of 2.9%. A number of other Japanese economic data also came out including the Tankan Non-Manufacturing Outlook for the first quarter which was also below expectations.
The Tankan Large All Industry Capex measuers the expenditure of the Japanese industries, excluding the financial industry. It is considered as a strong measure of the early stages of productivity growth in Japan. A higher than expected reading is considered to have a positive impact for the JPY.
The release of the data saw the Japanese Yen gain some 7 pips upon its announcement, pushing the USDJPY to a 1 month high of 83.43. The pair has been gaining throughout the Asian session so far, with resistance levels seen at 83.97 – the February 16th high, which if broken may see the pair test the December 15th high of 84.49.
The recent downwards trend of the Yen against the Sterling and also noticeably against the Euro and GBO comes about as the G7 has in recent weeks intervened to help weaken the JPY and help improve the Japanese economy by allowing it to be more competitive with regards to their exports.