{"id":144594,"date":"2019-03-28T11:44:10","date_gmt":"2019-03-28T15:44:10","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=144594"},"modified":"2019-03-28T10:45:51","modified_gmt":"2019-03-28T14:45:51","slug":"upcoming-japan-retail-sales-and-more","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2019\/03\/upcoming-japan-retail-sales-and-more\/","title":{"rendered":"Upcoming Japan Retail Sales And More"},"content":{"rendered":"
March 28, 2019<\/div>
\r\n<\/div><\/div>

By <\/strong>Orbex<\/strong><\/a><\/p>\n

JPY traders ought to keep an eye on the economic calendar during Friday\u2019s Asian session since we have a bunch of potentially market-moving data on tap. Chief among them is the retail sales data.<\/p>\n

With concerns over weakness in the world\u2019s third-largest economy, we could see some added volatility in JPY pairs. Here are some things to consider when setting up your trades later.<\/p>\n

Schedule and Expectations<\/strong><\/h2>\n

We start with a host of second-tier data on Friday at 00:30 CET (or Thursday, 19:30 EST.) This will be employment data and Tokyo CPI. The latter we can safely ignore since it rarely ever moves the market.<\/p>\n

Employment<\/strong><\/h3>\n

Japan\u2019s employment,\u00a0<\/strong>however,\u00a0is uncharacteristically low due to cultural and demographic factors.\u00a0 So, the usual consideration for structural employment doesn\u2019t apply.\u00a0Expectations are for the rate to drop to just 2.2%\u00a0<\/strong>in line with the long-standing trend.<\/p>\n

Last month, there was an expectation for a drop in the unemployment rate. However, the data surprised by coming in higher, which can be considered negative for the JPY. If the projections are right this time around, the unemployment level could fall to the level it was in June of last year. A move higher, on the other hand, would put it far away from expectations and we ought to interpret it as a negative sign for the JPY. We can expect the jobs to applicants ratio to remain broadly flat, just ticking down a basis point to 1.62 from 1.63.<\/p>

\r\n
\r\n

Free Reports:<\/p><\/div>\r\n

\r\n

<\/a>\r\n\t Get Our Free Metatrader 4 Indicators<\/u><\/b><\/a> - Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter<\/p>

\r\n
\r\n
\r\n

<\/a>\r\n\t Get our Weekly Commitment of Traders Reports<\/u><\/b><\/a> - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.<\/p>

\r\n<\/div>\r\n

\r\n
<\/div>\n

Retail Sales<\/strong><\/h3>\n

Next, we have the meat and potatoes of the session at 00:50 CET (still Thursday at 19:50 EST). Here we can expect the release of the\u00a0retail sales\u00a0<\/strong>data and industrial production. These are definitely the more interesting data for the markets and are likely to set the tone for JPY pairs going into the weekend.<\/p>\n

What interests the market is the month over month figure, which we can expect to barely climb back to\u00a0positive territory at 0.3%.<\/strong>\u00a0This is an improvement over the\u00a0-2.3% of the prior month,\u00a0<\/strong>which was the worst performance since late 2015.<\/p>\n

Monthly retail sales tend to bounce up and down between positive and negative, but keep from going beyond the 2.0 mark in either direction. The expectation would bring the data series back to its generalized average, And, traditionally, a negative result is followed by a positive one. So if that pattern doesn\u2019t manifest, it could make some traders quite nervous. We can expect annualized retail sales to do better, increasing 1.3% compared to 0.6% in the prior month.<\/p>\n

At the same time, we also have industrial production. Expectations are that it will moderate its decline to just 0.3% from the 3.4% registered last month.\u00a0 A significant portion of Japan\u2019s industrial production is for export. And with\u00a0the trade situation\u00a0under pressure, continued poor numbers from this indicator are not surprising.<\/p>\n

Japan\u2019s Sales Problem<\/strong><\/h2>\n

Policymakers in Japan have been frustrated with the economy\u2019s performance. They have, in fact,\u00a0 been taking measures to try to address the situation with apparently less than satisfactory results. Recently we had the release of the opinions from the\u00a0March BOJ meeting. This showed that they were debating stepping up stimulus to boost growth. The architect of \u201cAbenomics,\u201d Yamamoto,\u00a0 suggested\u00a0last Tuesday\u00a0that the bank was likely out of options to deal with the economic situation.<\/p>\n

Weak retail sales get in the way of the government\u2019s plan to raise sales taxes later in the year, despite official assurances that it will go in effect. The government has implemented a points system with cashless payment systems to offset the impact of the tax hike. However, the high commissions of card transactions have led to many smaller businesses not wanting to opt into the system. And small businesses are likely to be the most affected by a sales tax hike since they don\u2019t have the market-making power of large retailers.<\/p>\n

While weakness in retail sales wouldn\u2019t be too much of a surprise, it would contribute to a darkening mood regarding Japan\u2019s export-driven economy. Arguably, poor performance is probably priced into the market, giving a higher chance of a relief rally if the data surprises to the upside.<\/p>\n

By <\/strong>Orbex<\/strong><\/a><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

By Orbex JPY traders ought to keep an eye on the economic calendar during Friday\u2019s Asian session since we have a bunch of potentially market-moving data on tap. Chief among them is the retail sales data. With concerns over weakness in the world\u2019s third-largest economy, we could see some added volatility in JPY pairs. Here […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-144594","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/144594","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=144594"}],"version-history":[{"count":2,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/144594\/revisions"}],"predecessor-version":[{"id":144597,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/144594\/revisions\/144597"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=144594"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=144594"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=144594"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}