Opened in Asia this morning at Y83.17 and edged up to highs of Y83.22 on the back of some early EUR/JPY demand from a French name. The move was quickly undone by strong supply from a major Japanese bank who also sold AUD/JPY forcing the USD/JPY back down to Y83.05. Rallies were then confined to Y83.13 before more year-end demand for yen,particularly through the crosses, led the pair to lows of Y82.84 settling later around Y82.90/95. Lower US yields were to blame in the wake of last night’s somewhat dovish Fed speakers, with Fed’s Dudley and Fisher hinting that the US would be doing little else to counter effects from Europe and that the Fed had “done its job”. EUR/JPY fell back from Y110.88 to Y110.43 and AUD/JPY slumped from Y87.06 to Y86.36. BOJ’s Miyao stated that economic activity was largely flat, but showed signs of recovery, and pledged to maintain powerful monetary easing to combat deflation. USD bids are seen towards Y82.60/65 and Y82.30/35 with resistance at Y83.00/10. EUR/JPY support is at Y110.30/40 with stops below, and again through Y110.00. Offers start from Y110.80/90.
EasyForexNews Research Team