The initial move after the Tokyo inflation data was for yen weakness:
In that post I made note that the weaker CPI reading fed through to a weaker yen as it takes off some pressure for nearer-term BoJ rate hikes. I've just printed out that post, torn it up, and flushed it down the toilet.
Yen bouncing back:
Since the CPI data we've had:
- Japan January retail sales +3.9% y/y (expected +4.0%)
- Japan January preliminary industrial output-1.1% m/m (vs. expected -1.2%)
- BoJ's Uchida says Japan's economy on a moderate recovery path - some weak spots
There's not a lot there that appear to be the smoking gun for the yen bounce - I guess Uchida fits the bill more closely than the data. Let me know what you think in the comments.
