The past 10 days have seen the Japanese Yen strengthen 3% against the USD – its largest such move in two years – with today’s rally prompting a rather painful ‘crash’ in the Nikkei 225 at the open and envoking the anger of Abe:
- *ABE SAYS CURRENCY CORRECTION HELPING EXPORTERS COMPETITIVENESS (except that there is no evidence of this in any macro data at all)
- *ABE SAYS IT’S POSSIBLE BOJ WILL FAIL TO REACH INFLATION TARGET (like for the last two decades)
- *ABE SAYS ECONOMY SUBJECT TO UNFORSEEN CIRCUMSTANCES (unpossible)
- *ABE SAYS BOJ MUST EXPLAIN IF IT FAILS TO REACH INFLATION TARGET (not my fault!)
It seems that perhaps the wise investing public is waking up to the fact that words do not speak louder than actions, that macro fundamentals are bad and getting worse, and that 36,000 target for the Nikkei may be a stretch goal here.
And it’s not just Abe – they are all out pointing fingers today:
- *ASO WON’T COMMENT ON FOREX LEVEL
- *KURODA: FOREX INTERVENTION IS GOVT’S RESPONSIBILITY
Do Not Panic!!
and from The Kyodo Times:
- Winter bonuses at Japan firms hit record low for 4th year in row
Some inflation eh?
Quite a 2-weeks for the JPY (and all the momentum-chugging FX carry crowd)…
and the Nikkei 225 is hurting…
As perhaps macro fundamental reality (that we have been vocfierously opinting out) is finally breaking through the bullshit and jawboning just isn’t enough.