JPY: Political comments and data in focus

USDJPY regained most of its upward momentum after the sharp rally of the previous weeks. Political rhetoric from Japan will continue to attract attention, particularly if it remains above 125. 

BoJ Board Member Harada commented on USDJPY that the "abnormally strong yen has been corrected" and "when you look at the improvements in competitiveness across many different industries, you could say we've reached a pretty good level" (Bloomberg interview, June 4). 

Barclays notes:

• In terms of economic data, we expect an upward revision in Q1 GDP (Monday) to +3.4% q/q saar (consensus: +2.7%), from +2.4% in the preliminary report, due to large upward revisions to private capex. 
  
  
• Regarding price dynamics, we forecast PPI to have dropped -2.3% y/y in May (consensus: -2.2%), the second consecutive month of decline. 
  
  
• We look for April current account (Monday) to show a smaller surplus (nsa) of trn (consensus: trn) than trn in March.