Opened in Asia at Y81.26 and slipped to Y81.17 in early trade this morning following a smaller than expected Japanese trade deficit. A Xinhua article on the PBOC possibly boosting liquidity and buying from Japanese banks and a US leveraged fund led a bounce to Y81.55, before exporters surfaced and led a small dip to settle back around Y81.40. EUR/JPY picked up from early lows of Y106.53 to Y107.00 before easing off to Y106.70. Into Europe and USD/JPY traded a very tight Y81.43-61 range, lacking direction. The rate slipped on the open to Y81.43 following sharp cable gains, before meeting demand in the dip and trade flat for the duration. The cross headed higher on the open and tracked EUR/USD buoyancy to Y107.05, before dipping back under Y107.00 to Y106.80. Demand was met and the rate bounced to Y107.10 ahead of key Spanish bond auctions. Inititial reaction saw a sharp spike to Y107.35 on release of what traders called ‘ok’ results, before heading sharply lower to settle around Y107.05 into NY.
EasyForexNews Research Team