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12 Jun 2013
Flash: Ren Yen gains shaved - BBH
FXstreet.com (Barcelona) - Brown Brothers Harriman analysts note that the yen recorded what looks to be its biggest advance in three years yesterday, and those gains have been shaved today.
Further, they see that the dollar was pushed to almost JPY95.50 yesterday and buying was seen in Asia and into the European morning before running out of steam near JPY97. They note that news from Japan was mixed, commenting that on one hand domestic corporate prices rose, extended its advancing streak to 6th consecutive monthly rise and lifting the year-over-year rate to 0.6%, the highest since December 11. On the other hand, machinery orders fell 8.8% in April. They write, “The more than expected decline follows the out sized 14.2% increase in March, but recall that the March gain was to offset the 13.1% decline in Jan (Feb was 4.2%). Although the Abe government continues to push for corporate tax cuts to boost investment, Japanese companies have the huge savings, but lack sufficient investment opportunities, at home.”
Further, they see that the dollar was pushed to almost JPY95.50 yesterday and buying was seen in Asia and into the European morning before running out of steam near JPY97. They note that news from Japan was mixed, commenting that on one hand domestic corporate prices rose, extended its advancing streak to 6th consecutive monthly rise and lifting the year-over-year rate to 0.6%, the highest since December 11. On the other hand, machinery orders fell 8.8% in April. They write, “The more than expected decline follows the out sized 14.2% increase in March, but recall that the March gain was to offset the 13.1% decline in Jan (Feb was 4.2%). Although the Abe government continues to push for corporate tax cuts to boost investment, Japanese companies have the huge savings, but lack sufficient investment opportunities, at home.”