- The Japanese Yen is under pressure on Japan’s concern about the strength of its currency.
- EUR is also under pressure on concerns about ECB Vice President candidate.
EUR/JPY is now around 132.00 in the European session, edging up 0.1% in a day of range-bound trading as the US is on holiday on Monday. Japanese Yen lost some strength on Friday after Japanese government said that it is watching Yen move with “greater” sense of concern and is ready to act (intervene) when actually needed.
The Japanese Yen is also under some pressure on the reappointment of Kuroda as the BOJ chief as he may continue his “powerful” easing until 2% inflation target is reached on a sustainable basis. BOJ may refrain from raising 10Y JGB yield as a part of its YCC (yield curve control) policy change in the near term, considering the recent rapid appreciation of Yen.
The USD/JPY was little moved by the mix of the economic data in Japan on Monday with trade balance flashing deficit of JOY -943B and exports rising 12.2% y/y in January while imports grew by 7.9% y/y. a
For the Euro, there was no important economic data today, but current account for December reaches slightly less than expected surplus of EUR 29.9B a.
Additionally, the Euro came under pressure after reports that Ireland has withdrawn its candidacy for ECB vice president post and will support the Finance Minister (FM) of Spain as a “consensus” candidate.
There is the strong buzz on the street that appointment of someone from Southern Europe like Spain could be strategic as someone from Germany is poised to take Draghi’s role next year.
Apart from politics regarding ECB’s VP post, EUR is also under pressure on news that Latvian central bank Governor Rimsevics, a member of the ECB’s governing council, was detained by the anti-graft bureau in a flurry of actions by officials.
Technically, EURJPY has now good support around 131.40 zones and for any bounce back, it needs to sustain above 132.50-133.00 price area.
Recommended content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.