IS THE BOJ’S SHIFT ENOUGH TO BOOST THE YEN? 2/3

Contrary to recessionary fears, heavy industry picked up in the spring, scoring 55.1 in April and 54.5 in May as companies built emergency safety stocks to mitigate Middle East maritime disruptions. Conversely, the services sector ground to an abrupt halt at 50.0, ending a 13-month expansion due to a massive 43-month high in fuel and energy operating costs. To preserve margins, service providers raised selling prices at a near-record pace, severely dampening local consumer demand and creating a highly atypical growth profile for Q2 and Q3.