Japan CSPI Comes in Better Than Expected in January

Japan CSPI Actual -2.2%, Expected -2.5%, Previous -2.5%

Release Explanation: This release measures the change in the price of services which are purchased by corporations. It is considered a leading indicator of consumer inflation because when corporations pay more for their services they usually pass on the extra costs to the consumer.

Trade Desk Thoughts: The corporate services price index fell to -2.2 percent for the month as commodity prices tumbled and a deepening recession caused companies to slow spending. Advertising agencies have been especially hard hit as demand wanes. Consumer prices in Japan have fallen for the first time in more than a year this January. There are also signs that deflation could return to the world's second largest economy, a problem that has plagued Japan since the early 90's.

Forex Technical Reaction: The yen has not had much of a reaction to this release. After rising nearly 200 pips in the previous day's trading, the pair is channeling about 30 pips above the neutral pivot point

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