Japan's Giant Manufacturing Index rises to 13.0 within the second quarter (Q2) of 2025 – Tankan survey
Enterprise confidence at massive producers in Japan rose to 13.0 within the second quarter (Q2) of 2025 from 12.0 in Q1, based on the Financial institution of Japan’s quarterly Tankan survey on Tuesday. This studying got here in above the market consensus of 10.0.
Additional particulars unveil that the massive Manufacturing Outlook for the second quarter arrived at 12.0 versus 12.0 prior. This determine got here in stronger than the 9.0 anticipated.
Market response to Japan’s Tankan survey
On the time of press, the USD/JPY pair was down 0.15% on the day at 143.82.
Japanese Yen FAQs
The Japanese Yen (JPY) is among the world’s most traded currencies. Its worth is broadly decided by the efficiency of the Japanese economic system, however extra particularly by the Financial institution of Japan’s coverage, the differential between Japanese and US bond yields, or danger sentiment amongst merchants, amongst different components.
One of many Financial institution of Japan’s mandates is forex management, so its strikes are key for the Yen. The BoJ has immediately intervened in forex markets typically, usually to decrease the worth of the Yen, though it refrains from doing it typically as a result of political issues of its foremost buying and selling companions. The BoJ ultra-loose financial coverage between 2013 and 2024 brought about the Yen to depreciate towards its foremost forex friends as a result of an growing coverage divergence between the Financial institution of Japan and different foremost central banks. Extra not too long ago, the step by step unwinding of this ultra-loose coverage has given some assist to the Yen.
During the last decade, the BoJ’s stance of sticking to ultra-loose financial coverage has led to a widening coverage divergence with different central banks, notably with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Greenback towards the Japanese Yen. The BoJ determination in 2024 to step by step abandon the ultra-loose coverage, coupled with interest-rate cuts in different main central banks, is narrowing this differential.
The Japanese Yen is usually seen as a safe-haven funding. Because of this in occasions of market stress, buyers usually tend to put their cash within the Japanese forex as a result of its supposed reliability and stability. Turbulent occasions are more likely to strengthen the Yen’s worth towards different currencies seen as extra dangerous to spend money on.
