Reported 8 months ago
Chris Wu from Cathay Futures Consultants and Huang Yen-Hong summarized the article on June 17, 2024, at 4:10 pm. This week, Japan will release May CPI and inflation data, with expectations that the yen will remain weak due to inflationary pressures. The Bank of Japan is expected to gradually reduce bond-buying as a preparation for the next interest rate hike. With the quad-witching day approaching, where multiple commodities settle simultaneously, and the yen short positions being covered, this could be seen as an opportunity for the yen to bottom out. Japan's GDP for the first quarter was revised to -1.8%, better than expected and a slight improvement from the initial -2.0% drop. The large manufacturing industry's business sentiment index for the second quarter was -1.0, better than the previous quarter. May's domestic Corporate Goods Price Index (CGPI) showed a 0.7% and 2.4% increase from the previous month and the same period last year, respectively, exceeding expectations. The Bank of Japan decided to keep the interest rate target at 0-0.1%, but Governor Haruhiko Kuroda indicated a gradual reduction of bond purchases and a possible rate hike in July. This led to the yen gapping up, bouncing off a 31-year low and crossing above short-term moving averages. The revised values for Japan's April seasonally adjusted industrial output and equipment usage were -0.9% and -0.3%, worse than previous figures, while the core machinery orders fell by 2.9%, surpassing estimates. The Japanese government's annual economic blueprints show weak consumption and uncertain inflation prospects, with recent data indicating that despite some recovery in corporate and private consumption, it still lags behind market expectations.
Source: YAHOO