EUR: Opened early Europe at $1.2886, Euro-dollar closed NY at $1.2903 after rate had eased off a recovery high of$1.2924 to $1.2885 before settling into tight range around $1.2900 into close. US weather conditions made for expected subdued trade which carried over to early Asia. Rate began to pick up demand into the Tokyo fix as it reacted to euro-yen demand, edging to a $1.2919 high before momentum faded. Rate eased off to $1.2900 before a brief recovery to $1.2916 but release of BOJ monetary policy, which disappointed markets, then saw rate drop to $1.2886 as euro-yen was sold off into early Europe. Asian sovereign demand emerged into the dip, the demand taking rate back above $1.2900 and on to an initial high of $1.2926 before it stepped its way on to $1.2949. Offers at $1.2950 countered and pressed rate back to $1.2930. US name demand late morning provided the momentum to take rate above $1./2950, with triggered stops extending move to $1.2960 where reports placed Asian sovereign sell interest. Rate was holding firm ahead of the NY open.
GBP: Opened early Europe at $1.6030 and stg0.8046, GBP closed in NY $1.6034 after recovering off $1.6007 low to $1.6039. Rate initially eased to $1.6022 in early Asian trade before settling between $1.6025/40 for most of an otherwise quiet session, markets were seen awaiting developments on US weather effects. Rate squeezed back down to $1.6021 into the European open as yen pairs were driven lower on disappointing BOJ easing announcement. Euro-sterling opened Asia around stg0.8050 before getting shoved up to stg0.8057 (Monday high stg0.8056, seen on suggested end month sovereign interest with decent buying seen at Monday’s London fix). Rate eased back to stg0.8041 as cable trailed euro-dollar’s reaction to BOJ, before settling back around stg0.8050 into Europe. Cable recovered into Europe in tandem with euro-dollar, though progress was countered in part by the cross recovering to stg0.8064, the rate edging to a high of $1.6072 before momentum faded. Cable pulled back to $1./6045 with euro-dollar slippage before rallying back late morning to retest the highs.
JPY: Opened in early Europe at Y79.47 and Y102.70, Dollar-yen opened flat in Asia at Y79.75, the rate lifted to Y79.90 on cross demand through the Tokyo fix and ground to highs of Y79.99 ahead of the BOJ announcement. The BOJ decided to expand its asset-buying program by 11tln to Y91tln and dollar initially jumped to Y80.14 on release, before slipping sharply to Y79.28, flushing large stops on the move. Many expected the BOJ to take a more agressive stance following release of weaker than expected Industrial output and the move clearly disappointed markets. Euro-yen spiked to Y103.41 on release, before a wave of strong supply pressed sharply lower through stops to Y102.17, later recovering to Y102.60. Dollar-yen opened flat in Europe with trade tied to a narrow range, system/prop name sales weighed briefly to Y79.33, before lifting to Y79.45. The cross tracked early demand in euro-dollar to Y102.99, before meeting resistance and grinding to Y102.60. Rate bounced and extended recovery attempts to close the morning around Y102.90.
EasyForexNews Research Team