Release Explanation: This report evaluates the monthly change in output that is produced by Japans service sector. Japans economy is weighs heavily on exports and because this report excludes manufacturing and only measures the services industries it is a key indicator of domestic activity. The data is collected from wholesale and retail trade, financial services, health care, real estate, leisure, and utilities. Strong spending in the services sector usually translates to higher employment rates, and can also be a sign of strong consumer spending now and in the future.
Trade Desk Thoughts: Japans tertiary industry activity index decreased 0.9 percent for November. This was slightly worse than analysts' expectation of a 0.8 percent drop. The previous figure of 0.4 percent for October has been revised to 0.5 percent. The current environment in Japan is making it difficult for service consumption to follow an upward path. Toyota Motor Corp. has cut 4500 jobs as demand for vehicles falls off, and Sony Corp. has also stated it will lay off workers as the countries recession deepens. Consumers in Japan, which account for more than half of the gross domestic product have limited their spending for the past nine months, which is the longest losing streak seen in the past two years.
Forex technical Reaction: The Japanese yen has found resistance at the neutral LFB pivot point and is currently heading toward the pairs opening price of 90.46.