Yen Indifferent as Tankan Survey Shows Improved Corporate Sentiment

Talking Points:

• Improved Q1 corporate sentiment fails to spur the Yen into action


• Large manufacturers are at their most optimistic since Q4, 2015


• Data’s limited impact on BOJ policy makes for tepid FX response

What will drive the Japanese Yen trend in the second quarter? See our forecast to find out!

The Japanese Yen offered a tame reaction as Japan’s Tankan business data crossed the wires showing an improvement in corporate sentiment. The survey pointed to optimism in the manufacturing sector on expectation that a weaker currency will boost exports in the coming quarter.

The closely-watched large manufacturers’ index rose to 12 in the first quarter from 10 in the prior period, marking the highest reading since the three months to December 2015. Still, the outcome fell short of forecasts projecting an even rosier result (14).

The data appeared to carry little weight with traders, with the Yen’s response after the figures crossed the wires lackluster at best. That may reflect its limited implications for near-term BOJ policy trends, with Governor Kuroda and company seemingly in no hurry to alter the status quo.

Yen Indifferent as Tankan Survey Shows Improved Corporate Sentiment
Yen Indifferent as Tankan Survey Shows Improved Corporate Sentiment
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