Industrial production in Japan in May (preliminary) -7.2% m/m (expected -0.3%)


Eamonn Sheridan

Wednesday 29/06/2022 | 23:47 GMT-0

06/29/2022 | 23:47 GMT-0

Japanese Industrial Production for May (preliminary) -7.2% m/m…a huge miss…epic miss more like

  • expected -0.3% m/m, prior -1.5%
  • this is the largest drop m/m since the pandemic hit May 2020

-2.8% y/y

  • expected -5.9% y/y, before -4.9%

Manufacturing forecast for the coming months:

  • see June production +12.0% m/m
  • see July production +2.5% m/m

The Japanese government lowered its assessment of industrial production…unsurprisingly given this monumental misfire.

  • says production is faltering
  • motor vehicle production down 8% in May
  • government says May crisis was caused by Chinese covid lockdowns affecting automobiles, batteries, air conditioners and production machinery

JPY

JPY

The Japanese yen (JPY) is the official currency of Japan and, at the time of writing, is the third most traded currency in the world behind the US dollar and the euro. The JPY is widely used as a reserve currency and is used by traders as a safe haven currency. Originally set up in 1871, the JPY has a long history and has survived several world wars and other events. This was followed by the establishment of the Bank of Japan (BoJ) in 1882 and full oversight of the JPY by the Japanese government only in 1971. Japan has historically maintained a policy of monetary intervention, which continues to this day. The BoJ also adheres to a zero to near zero interest rate policy and the Japanese government previously had a strict anti-inflation policy. Any other changes in monetary policy by the central bank are closely watched by forex traders. Also, the overnight call rate is the main short-term interbank rate. The BoJ uses the call rate to signal monetary policy changes, which in turn impact the JPY. The BoJ also buys 10- and 20-year Japanese government bonds (JGBs) on a monthly basis to inject liquidity into the monetary system. The consistent yield on the benchmark 10-year JGBs helps serve as a key indicator of long-term interest rates. Economic data is also very important for the JPY. The most important of these releases in Japan are Gross Domestic Product (GDP), Tankan Survey (Quarterly Survey of Business Sentiment and Expectations), International Trade, Unemployment, Industrial Production and GDP readings. money supply (M2 + CD).

The Japanese yen (JPY) is the official currency of Japan and, at the time of writing, is the third most traded currency in the world behind the US dollar and the euro. The JPY is widely used as a reserve currency and is used by traders as a safe haven currency. Originally set up in 1871, the JPY has a long history and has survived several world wars and other events. This was followed by the establishment of the Bank of Japan (BoJ) in 1882 and full oversight of the JPY by the Japanese government only in 1971. Japan has historically maintained a policy of monetary intervention, which continues to this day. The BoJ also adheres to a zero to near zero interest rate policy and the Japanese government previously had a strict anti-inflation policy. Any other changes in monetary policy by the central bank are closely watched by forex traders. Also, the overnight call rate is the main short-term interbank rate. The BoJ uses the call rate to signal monetary policy changes, which in turn impact the JPY. The BoJ also buys 10- and 20-year Japanese government bonds (JGBs) on a monthly basis to inject liquidity into the monetary system. The consistent yield on the benchmark 10-year JGBs helps serve as a key indicator of long-term interest rates. Economic data is also very important for the JPY. The most important of these releases in Japan are Gross Domestic Product (GDP), Tankan Survey (Quarterly Survey of Business Sentiment and Expectations), International Trade, Unemployment, Industrial Production and GDP readings. money supply (M2 + CD).
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