Nikkei Rises After Weaker JPY and Oil Drop

apan’s Nikkei index closed at its highest level for two weeks, with exporters boosted by a weaker yen and airlines helped by falling oil prices.

The Nikkei 225 closed up 211.35 points, or 1.2%, at 17,459.85.

Shares in exporters rose as the dollar went above 118 yen. A weaker yen helps make Japanese exports more competitive.

Falling oil prices and the prospect of cheaper fuel pushed Japan Airlines’ shares up 5.3%, while rival All Nippon Airways jumped 7.4%.

The decision by oil producers’ group Opec on Thursday to maintain current output levels sent the price of oil down sharply. Brent crude was trading at $72.49 a barrel on Friday having fallen by more than $5 on Thursday.

Investors were also digesting a large amount of economic data from Japan, which painted a mixed picture of the world’s third-largest economy.

Excluding the effect of a large tax rise in April, the inflation rate in October was 0.9%, way below the 2% target.

Including the tax rise, core inflation was 2.9% higher in October than a year ago, compared with 3% in September.

Household spending fell by 4% in the year to October, but retail sales rose 1.4%, beating expectations and the unemployment rate fell from 3.6% to 3.5%.

via BBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza