Advertisement
Advertisement

Japanese Employment Highest for two Decades, Yen Rises

By:
Peter Taberner
Published: Aug 30, 2016, 11:11 UTC

Japan’s employment levels have fallen to there lowest level in 21 years according to official figures, even though growth in the Japanese economy is

Yen Rises on Employment Figures

Japan’s employment levels have fallen to there lowest level in 21 years according to official figures, even though growth in the Japanese economy is currently stagnant at 0% in the second quarter this year.

The newly seasoned adjustment employment data, revealed that unemployment is at 3% in July, of those who are eligible to work, a fall from the June figure of 3.1%, the latest figure is just above what the authorities would deem as full employment in the economy.

In reaction, the Japanese Yen has strengthened against the US Dollar, with USD/JPY rate now buying Y102.3, throughout this morning GMT, the greenback has gained ground on the Yen, beginning the day purchasing just under Y102, and even falling to below the Y101.8 mark.

Against the euro, the Yen has also gained ground, with the EUR/JPY rate at 114.2, from a peak in the euro’s favour of EUR/JPY 114.4, like the dollar, the euro has started the day favourably against the Yen, having fallen to buying just over Y113.8 in the first few hours of trading CET.

The latest figures give the Japanese economy some respite, as its has consistently suffered adverse news in recent times, growth in 2015 was at a negative minus 0.4% in the second and final quarter of last year, inflation has also been an issue for Japanese governments, in the previous five months prices have fallen into negative territory, stubbornly remaining at 0.4% since May this year, well below the government’s 2% target.

Earlier this month, the Japanese prime minister Shinji Abe and his government approved a stimulus worth £275 billion, the Bank of Japan (BOJ) also announced that it would purchase exchange trading funds, increase lending growth in US dollars to support Japanese firms in their overseas activities, and an expansion of BOJ buying government bonds at an annual rate of 80 billion Yen on an annual basis.

UK Suffers Fall in Mortgage Approvals

Bank of England figures have declared that the levels of mortgage approvals have fallen by 5% in July, in the first full monthly mortgage data to be released since the UK decided to leave the European Union.

Overall, there were 60,912 new mortgages which were rubber stamped, a decline in activity from the 64,152 applications to buy houses in June, in total the amount lent out for house purchases reached £10.4bn, down from £11.1bn in June, also the latest figures highlighted a 12.4% drop in the annual approvals from the corresponding month for last year.

Its possible that ‘Brexit’ has increased anxiety amongst potential home owners, as leaving the EU is likely prompt huge uncertainty in the UK economy for a considerable period of time, in the first quarter of this year the housing market was boosted by buyers trying to beat the increase in tax duties for mortgages, which were introduced in April.

The release of the ‘medium tier’ data has not effected the pound too badly, with the GBP/USD rate having a turbulent relationship this morning GMT, with the pound falling to a nadir of buying jut under $1.307, before jumping up to $1.308, the pound has taken a fall against the dollar since Federal Chair Janet Yellen strongly hinted that economic conditions in the United States have strengthened the argument for a rate rise.

About the Author

Did you find this article useful?

Advertisement