Shutterstock photo
Markets

Bank of Japan Interest Rate Decision

Shutterstock photo

Shutterstock photo

The dollar traded lower during the New York trading session but still within defined price ranges as markets look for a new catalyst to continue the bullish run in the dollar. Later this evening the Bank of Japan will release their interest rate decision that could include additional monetary policy easing measures.

Forex rates for the dollar were mixed but overall weakness was seen after US economic data releases. Weekly unemployment claims were better than forecasted and initially the dollar benefited from the surprising jobs data. However, dollar sentiment was thwarted after the release of weaker than expected existing home sales and a significantly lower Philly Fed Manufacturing Index.

The EUR/USD traded as high as 1.4322 after rising from a low of 1.4194 during the European session. Cable held its gains after strong retail sales numbers and looks to end the day near its high at 1.6229 from 1.6179. The USD/JPY fell back from a high of 82.22 to trade at its opening day price of 81.55 following the disappointing US manufacturing data. US equities were flat with the S&P 500 up only 0.07% and crude oil traded back below the $100 mark.

Forex macro news will be out later tonight with the release of the Japanese overnight call rate. No change is due to the interest rate but calls have been made for the BoJ to introduce new easing measures to assist both the recovery from the earthquake and tsunami as well as the decline in growth rates. Yesterday's Japanese GDP numbers showed the economy is currently in a recessionary mode. While the disaster did little to help the economy, the data shows the decline in growth rates had its beginnings prior to the earthquake and tsunami. New easing measures by the Bank of Japan could send the USD/JPY higher to the retracement levels from the April to May move at 82.50 followed by 83.25.

Read more forex trading news on our forex blog .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Other Topics

ForEx