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Forex - USD/JPY close to 4-month low, no BoJ action seen

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Forexpros - The U.S. dollar was down for a fifth day against the yen in volatile trade on Thursday, hovering close to a four-month low, fuelling speculation the Bank of Japan will intervene in the currency market to stem the yen's gains.

USD/JPY hit 76.29 during European morning trade, the lowest since August 1, when the pair sank to a four-month low of 76.28; the pair subsequently consolidated at 76.51, retreating 0.45%.

The pair was likely to find short-term support at 76.12, the low of March 16 and resistance at 77.30, Wednesday's high.

The greenback spiked higher against the yen earlier before falling back, sparking speculation that the Bank of Japan stepped in to curb the yen's recent sharp gains.

However, an official from the country's Ministry of Finance declined to comment on the sudden movement in the pair and whether the government was intervening in the market.

Traders added that the BoJ conducted a foreign-exchange rate check Thursday, which triggered the yen's slide.

Earlier in the day, Japanese Finance Minister Yoshihiko Noda sharpened his verbal warnings to markets, saying "We are keeping an extremely close watch on currency moves, while working closely with the global community."

Meanwhile, Prime Minister Naoto Kan told parliament that the government was considering what it can do to address what he called "somewhat one-sided moves" in the yen.

Last week, Japan intervened to curb the yen's gains for the first time since March. In addition, the BOJ announced additional monetary easing to further bolster growth, pledging to buy more assets such as stocks and bonds.

Elsewhere, the yen was fractionally higher against the euro, with EUR/JPY easing down 0.02% to hit 108.94.

Later in the day, the U.S. was to release official data on its trade balance, as well as a government report on initial jobless claims and natural gas stockpiles.

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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.

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