FX.co ★ Yen Steadies on Strong Economic Data

The Japanese yen stabilized at approximately 156.3 per dollar on Friday, poised to conclude the week with minimal fluctuations. This steadiness was bolstered by economic data surpassing expectations. In October, industrial production and retail sales outperformed forecasts, while the unemployment rate remained unchanged. Additionally, Tokyo’s core inflation figures exceeded expectations, aligning with the Bank of Japan's potential trajectory towards an interest rate hike in the near future. Earlier in the week, speculation intensified regarding the central bank possibly raising rates next month due to persistent inflation, the yen's depreciation, and diminished political resistance to low rates. Nevertheless, for the month, the yen is projected to decline by over 1%, driven by increasing concerns about Japan's fiscal state. Recently, the cabinet approved a stimulus package amounting to 21.3 trillion yen, with Prime Minister Sanae Takaichi's administration reportedly planning to issue at least 11.5 trillion yen in additional bonds to finance the expenditure.