Safe-haven currencies, such as the Japanese Yen, have been boosted by the recent tensions between Russia and the Ukraine, but the Yen has softened on Monday following a declination in capital spending.
The Pound Sterling to Japanese Yen exchange rate is currently trending in the region of 173.2000.
On Friday of last week the Japanese Yen softened across the board after several economic data publications left a lot to be desired. The Yen’s safe-haven qualities, however, minimised the declination in light of the increased tension between Russia and Ukraine.
Japanese unemployment showed an unwanted increase on the 3.7% forecast figure to 3.8%. Yearly Household Spending fell well below the forecast figure of -2.9%, printing at -5.9%. The National consumer price index data, however, met with forecast figures.
Japanese Industrial Production was expected to decline from the previous figure of 3.1% to -0.1%, but the actual data showed a massive drop to -0.9%. Also Housing Starts data showed a yearly declination of -14.1% despite having been forecast at -10.5%.
Conversely, Friday’s British economic data was much more welcome, having exceeded expectations. The year-on-year Nationwide House Px eclipsed the forecast 10.2% showing the actual growth to be 11.0%. This was due to a huge increase of 0.8% in August despite having only been expected to grow by 0.1%.
Also British consumer confidence surprised analysts with a surplus figure of 1 having been forecast at a deficit of -1.
Sterling was also bolstered on Friday following developments regarding the Scottish bid for independence. Scottish Prime Minister Alex Salmond submitted to the fact that, should Scotland gain independence, they will have to inherit a portion of the British national debt.
The Pound Sterling to Japanese Yen exchange rate has hit a low today of 172.6800.
Monday has seen a continuation of less-than-ideal Japanese domestic data publications. Capital Spending, which tracks all investment by Japanese corporations in new capital including expenditure on software, electronics and IT-related products, was forecast to drop from the previous figure of 7.4% to 4.1%, but the actual figure was a disappointing 3.0%.
To accompany this less-than-ideal capital spending data was Company Profits which showed a huge decline from 20.2% to 4.5%, and Company Sales which dropped from 5.7% to 1.1%. The Japanese Manufacturing PMI fell fractionally from 52.4 to 52.2, and vehicle sales showed a deficit growth of -5.0%.
British data has been mostly positive on Monday, although the manufacturing data has left a lot to be desired. The UK Manufacturing PMI was forecast to rise from the previous figure of 54.8 to 55.1, but the actual data showed a decline to 52.5. However, Mortgage Approvals, Net Consumer Credit and Net Lending Sec. on Dwellings all managed to exceed the forecast figures.
The Pound Sterling to Japanese Yen exchange rate has hit a high today of 173.3600.
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