EUR/JPY – EUR/JPY has stayed within a 450-pip range for the past month and a half, and it’s look after BOJ this week decision market is just little confuse on this pair
This week as we know the BOJ as made changes to its stimulus programme, in its latest attempt to spur economic growth. The bank kept interest rates unchanged, but said it would aim to keep yields on 10-year government bonds at around current levels of zero percent.
It will continue to buy assets such as government bonds, at the rate of 80tn yen ($787bn; £605bn) a year. I Believe that what the BoJ did is important - not just for Japan, but for other developed economies.
It set a target of zero for the 10-year bond yield. Basically this means it wants to protect the long-term interest rate from creeping below zero even if short-term interest rates do go negative. So by bringing back the gap between short and longer term rates the BoJ helps banks and investors earn a better return in their business and investment.
As in EUR/JPY I see the max down is 110 level and for longer teram by end of this year I see the rally till 116
I believe that BOJ will do what it takes and they always closely monitor the JPY move which gives us a thought that there will be always room for intervention in case if the JPY gets stronger.
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