Japanese Manufacturing Survey Results Weaken Yen

According to the preliminary survey, the expansion of manufacturing activity in Japan almost vanished. The report indicates the growth of the Japanese economy is still shaky and brought yen weakened.

The yen weakened against the greenback immediately after the survey was released. USD / JPY rose 12:14 percent to 121.61, after touching had slumped to 121.09.

Japan's Ministry of Finance reported the Business Survey Index (BSI) manufacturing slowed from 11.0 in the September quarter to 3.8 in the last quarter of this year. Analysts expect an increase towards 12.1. Figures greater than zero indicates optimism otherwise below zero indicates pessimism. BSI is an early indicator before Tankan survey from the Bank of Japan (BoJ), which is used as the basis of monetary policy and was released about a week later.

Since April 2013 then, the BoJ has implemented a quantitative easing program (QQE) in order to raise inflation and consumer spending. Signs of the growing strength of the Japanese economy put pressure on the central bank to expand the program QQE again. On Wednesday, Japanese GDP -0.2 September quarter was revised up to 0.3 per cent, while the June quarter was also revised -0.1 percent from -0.2 percent previously. Core machinery orders report yesterday also increased 10.7 percent, exceeding analyst estimates shrank 1.5 percent.