The yen is testing multi-year lows both against the dollar and euro in earlly Asia after Bank of Japan Governor Masaaki Shirakawa announced his intention of resigning earlier on March 19. He was originally scheduled to step down on April 8. The decision spurred speculation that the BOJ would accelerate the monetary easing to help support Prime Minister Shinzo Abe’s pledge to beat deflation. Investors will also focus on who would take the top post at the Japanese central bank. The yen reached Y93.65 versus the dollar on Tuesday, the weakest since May 2010, while Y127.22, the least since April 2010. MNI reported, citing well placed Eurosystem officials, that the renewed strength of the euro is welcomed by monetary authorities as a sign of returning confidence in the Eurozone, although the pace of the recent rise is less comforting. Meantime, riskier currencies may draw some buying interest, as overall risk sentiment improved thanks to decent economic data out of Europe, which lessened concerns about the resurgence of the debt crisis. Yields on Treasury’s 10-year notes climbed five basis points to 2.0%, while the Standard & Poor’s 500 Index rose 1.04%. The dollar moved from Y91.98 to Y93.65 on Tuesday.
EasyForexNews Research Team