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Forex pairs in this Article » USD/JPY
FXStreet (Córdoba) - Derek Halpenny, European Head of Currency Strategy at the Bank of Tokyo Mitsubishi UFJ commented on Japanese wage data and the USD/JPY, noting that the pair will likely hold above 100.00.

Key Quotes

"Data released from Japan today underlined the importance of the 3rd arrow of 'Abenomics' as wage data for December confirmed that real wages in Japan fell back to the record low set in 2009. Higher inflation is being achieved but until nominal wages follow, the Japanese consumer will feel the pain in real terms."

"Furthermore, if wage gains do not kick in soon, Japanese consumers will have the sales tax increase to contend with in April. The good news is that the data at least shows that nominal wages are moving in the right direction. Labour cash earnings on an annual basis accelerated from 0.6% in November to 0.8% in December – the highest level since March 2012. The two-month average annual rate was the highest since 2010. Still, PM Abe's focus is on base wages and on that measures, wages fell 0.2% in December".

"But over the coming days the US labour market reports will be key given the run of weak data perhaps that's where the risks lie but we expect solid support from Japanese names to keep USD/JPY above the 100.00 level."
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