PPI and Current Account data in focus for the JPY

April PPI (Friday) will provide the latest information on inflation dynamics in Japan. The PPI is expected to fall -2.0% y/y (consensus: -2.1% y/y), the first negative reading since March 2013.

Such weakness on upstream inflation implies a potential drag on the CPI-based consumer goods. Indeed, core CPI also likely to decrease y/y from May through November this year due to falling energy-related prices. 

Subdued inflation dynamics are likely to result in further BoJ easing in July, but further easing via ETF purchases should have a limited effect on the JPY.

Another focus will be the March Current Account (Wednesday), which will likely show another improvement led by trade balances and helped by falling oil prices. 

"We expect the current account surplus (nsa) to widen to trn (consensus: 2.071trn) from 1.440trn in February. On a seasonally adjusted basis, we look for it to increase to trn (consensus: 1.358trn), or the 12th consecutive months of surplus", says Barclays.