The Japanese yen was the weakest currency on the Forex market today but among the strongest for the week. With no unifying theme to drive markets, it is hard to pinpoint an exact reason for the currency’s poor performance, though some market analysts attributed it to the positive market sentiment that made the yen unnecessary in its role of a safe haven. As for Japan’s macroeconomic reports, they were not that bad but it hardly helped the currency.
Japan’s Ministry of Finance reported in its Business Outlook Survey for the July-September quarter that the business survey index for manufacturing jumped to 0.1 after sinking to -52.3 in the previous three months. That was a surprise to experts who were expecting just a modest improvement to -36.1. A reading above 0.0 indicates optimism and below means pessimism.
According to a report from the Bank of Japan, the Producer Price Index fell 0.5% in August, year-on-year, matching market expectations. While not a good reading by itself, it was a small improvement compared with July’s 0.9% rate of decline. Month-on-month, the index rose 0.2%, slowing from the previous month’s 0.6% rate of growth.
Japan and Britain reported that they are close to reaching a post-Brexit trade agreement. Japanese Foreign Minister Toshimitsu Motegi and British International Trade Secretary Liz Truss were meeting via video conference today, and it looks like they have reached a consensus. They hope to have a deal in January. Initially, both sides hoped to have a deal by the end of August but were unable to do so due to some disagreements.
USD/JPY traded about flat at 106.16 as of 11:42 GMT today. EUR/JPY rallied from 125.38 to 125.81, reaching the daily high of 126.12. GBP/JPY gained from 135.88 to 136.25.
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Japanese Yen Weak on Friday, Strong Over Week
