USD/JPY edged up from early overnight session lows of Y79.19 to Y79.44 into early European dealing, as the underlying risk on tone, along with recent threats of yen intervention, continue to prompt an outflow form yen, though at a slow pace. Market chatter of global stimulus plans, along with hopes for a support package for Spain has boosted the risk tone, with equity markets taking the lead. Fed Bernanke testimony to US law makers at 1400GMT today seen as key as market await hints for, or against, QE3. Release of strong Australian jobs data overnight, following on from Wednesday’s strong GDP data, saw strong demand for AUD/JPY, which provided an added lift for dollar-yen along with other yen crosses. EUR/JPY traded up from Y99.54 to Y99.89, but offers placed toward Y100.00 prevented stops above from being triggered. Rate has since drifted lower, in line with EUR/USD to Y99.80, while USD/JPY trades around Y79.40 into early Europe. Market remains on headline watch for direction.
EasyForexNews Research Team