Yen Soft After Macroeconomic Releases in Japan

The Japanese yen was soft today following domestic macroeconomic releases. The data showed that the nation’s manufacturing sector was in bad shape. At the same time, unemployment remained extremely low, defying forecasts of an increase.
The Statistics Bureau of Japan reported that the unemployment rate remained unchanged at 2.2% in August. That contradicted analysts’ forecasts of an increase to 2.3%.
The Tankan large manufacturing index fell from 7 in the June quarter to 5 in the September quarter. That was the third consecutive quarterly decline and the lowest reading since June 2013. Nevertheless, the actual value was above the consensus forecast, which had promised an even bigger drop to 1. The Tankan large non-manufacturing index also fell, demonstrating a decline from 23 to 21. Yet it too was above the median forecast of 20.
The Jibun Bank Japan Manufacturing PMI dropped to 48.9 in September from 49.3 in August according to the final estimate, unrevised from the flash report. Economists had predicted it to stay unchanged at the August level. The reading below 50.0 means that the sector was declining with an accelerating pace.
USD/JPY rose from 108.07 to 108.29 as of 12:14 GMT today, touching the high of 108.47 intraday. EUR/JPY was up from 117.78 to 118.01. GBP/JPY rallied from 132.80 to 133.35 intraday but has declined to 132.64 by now.

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