ForexLive Asia-Pacific FX news wrap: Tokyo inflation collapse, yen loses ground

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USD/JPY
rose from around 147.50 to circa 147.85 on the back of Tokyo January
inflation data. CPI fell sharply in the month, with two of the three
measures plunging under the Bank of Japan’s 2% target. This raises
doubts on how soon the Bank can tighten its ultra-loose monetary
policy. If you glance at your charts you’ll see the USD/JPY move
was retraced just as quickly. Later data showed corporate service
inflation holding steady at a nearly nine-year high in December.</p><p>Also
from Japan today we had the minutes of the Bank of Japan December
meeting. These were quite dated, of course, we’ve had the January
meeting since. The minutes noted, in summary, discussion on the need
to keep policy loose and also flagged the need for discussion on steps to
be taken when the time comes to adjust policy.
</p><p>Otherwise
news and data flow was light.</p><p>We
did get news from China that the Ministry of
Housing and
Urban-Rural Development started an inaugural meeting of the Urban
Real Estate Financing Coordination Mechanism today.
This
sent Hong Kong-listed
property developers higher on the
HKEX.
</p><p>We
also had news that China’s Foreign Minister Wang Yi and US National
Security Adviser Jake Sullivan will meet in Bangkok on Friday and
Saturday to discuss the Houthi attacks on Red Sea shipping. Kirby
said that “China has influence over Tehran; they have influence
in Iran … We would welcome a constructive role by China, using the
influence and the access that we know they have, to try to help stem
the flow of weapons and munitions to the Houthis.” Oil lost ground
during the session related to this.</p><p>USD/JPY update:</p>

This article was written by Eamonn Sheridan at www.forexlive.com.