We have had a couple of Japanese data items already today:
- Japan data: April Overall household spending -1.3% y/y(expected +0.8%) (shrank for the 3rd consecutive month running in April)
- Japan Nikkei/Markit PMIs (May): Services 51.0 (prior 52.5), Composite 51.7 (prior 53.1)
Neither of these argue for a strengthening yen.
On the consumption data, recap via Capital Economics
- "core" household spending down 0.8% m/m
- 3rd third consecutive fall
- hit a 6-month low
- CE expect consumer spending to return to growth in Q2
Reuters have comments from UBS Securities:
- "I still expect the economy to rebound in the second quarter, but if consumer spending continues to weaken then I may revise down my expectations"
- "Household spending was surprisingly weak and consumer confidence is flattening"
Meanwhile, USD/JPY gained earlier toward 110.00. Buying was notable from Tokyo-based funds. Above 110 are exporter sell orders, 110 through to 110.15
