Asian session: The yen strengthened

01:45 China HSBC Manufacturing PMI February 49.5 49.4 48.3

The yen strengthened versus all its 16 major counterparts as investors sought the perceived safety of the Japanese currency after Asian stocks fell following private data that signaled weaker Chinese manufacturing. Preliminary reading showed an unexpected decline in a Chinese manufacturing Purchasing Managers’ Index from HSBC Holdings Plc and Markit Economics. Today’s reading of 48.3 for HSBC and Markit’s Chinese manufacturing gauge compares with January’s final figure of 49.5 and the 49.5 median estimate in a Bloomberg News survey of 17 economists.

Japan’s currency was also supported before a report today that may show U.S. inflation slowed, adding to concern the recovery in the world’s biggest economy is weakening. The dollar slid versus its Japanese counterpart before data that economists estimate will show U.S. consumer price index gains slowed to 0.1 percent last month. Separate reports today may show a decline in initial jobless claims and an advance in the Conference Board’s gauge of the economic outlook for the next three to six months.

Several Federal Reserve policy makers said that, in “the absence of an appreciable change in the economic outlook, there should be a clear presumption in favor” of continuing to trim the central bank’s asset purchases by $10 billion at each meeting, according to minutes of the Federal Open Market Committee’s Jan. 28-29 gathering published yesterday.

EUR / USD: during the Asian session, the pair rose to $ 1.3755

GBP / USD: during the Asian session, the pair traded in the range to $ 1.6665-85

USD / JPY: on Asian session the pair fell to Y101.85

There is another full calendar Thursday, with the main features in the morning session likely to be the release of the euro area flash manufacturing and services PMI numbers for February. The European calendar gets underway at 0700GMT, with the release of the German January PPI data, with analysts looking for +0.2% on month, down 0.8% on year. At 0745GMT, the French January HICP numbers will be published. The release of the main euro area flash PMI numbers kicks off at 0758GMT, when the French manufacturing and services numbers cross the wires. At 0800GMT, ECB Vice-President Vitor Constancio is scheduled to speak in Brussels. The flash PMI numbers continue at 0828GMT, when the German numbers are released, followed by the amalgamated eurozone data at 0858GMT. Italian December industrial orders data will follow at 0900GMT. At 1400GNT, the Belgian consumer confidence data will be released.