Intra-day Market Moving News and Views (USD/JPY)

Intra-Day Market Moving News and Views (USD/JPY) 
11 Mar 2016 02:00GMT

USD/JPY ..... A government survey showed that the Japanese business sentiment worsened sharply in the first quarter, suggesting that financial market turbulence and sluggish global demand were taken a toll on a fragile economic recovery. 
The data keeps pressure on policymakers to deploy additional fiscal and monetary stimulus measures to reflate an economy that is skirting another recession. 

The business survey index (BSI) of sentiment at large manufacturers stood at minus 7.9 in January-March, swinging from plus 3.8 in October-December, according to a joint survey by the Ministry of Finance and the Economic and Social Research Institute, an arm of the Cabinet Office. 
The index measuring big manufacturers' sentiment three months ahead stood at minus 3.5, a sign the gloomy outlook may discourage companies from boosting wages or capital expenditure, given sluggish demand in China and other emerging Asian markets. 
Companies expect capital expenditure to have risen 8.8 percent in the current fiscal year ending in March, but shrink 6.6 percent in the coming business year, the survey showed. 

The world's third-largest economy shrank in the final quarter of 2015 as slow wage growth and sluggish global demand hurt consumption and exports. 
While many analysts expect growth to have rebounded modestly in the current quarter, the bleak outlook for global demand has led some to predict another contraction that will push Japan back into technical recession - defined as two straight quarters of economic contraction. 

The BSI measures the percentage of firms that expect the business environment to improve from the previous quarter minus the percentage that expect it to worsen. 
Japanese Finance Minister Taro Aso said on Friday that he hoped the BOJ would continue its efforts to achieve its 2 percent price target, while suggesting that specific monetary policy steps were up to the central bank to decide. 
The adoption of negative interest rates by the BOJ is already having an impact such as bringing down housing loan rates. 
The BOJ is set to hold off cutting interest rates at next week's rate review, as it scrambles to soothe market jitters which was caused by January's surprise decision to adopt.