The pair closed in NY Monday at Y102.27, the rate having drifted off its early recovery highs of Y102.92 having seen earlier react lows of Y101.97 following Japan Amari comments on the value of the yen. Rate extended this corrective pullback to Y102.08 into early Asia before it spiked up to Y102.77 as Amari sought to clarify those weekend comments saying the he has said before that excessive yen strength is being corrected and that he hoped the FX market can strike a balance between impact on imports and exports and find stability at a level in line with fundamentals. The reaction saw general demand for dollars emerge but those sitting long dollars took advantage of the move to pare back positions allowing dollar-yen to drift back to Y102.45, settling around Y102.50 into Europe. Traders expect some consolidation around this level ahead of the BOJ policy announcement Wednesday, followed by Bernanke testimony and FOMC Minutes later in the day. Euro-yen tracked dollar-yen moves, the recovery tripping stops from Y132.15 which took rate to an overnight high of Y132.30 from early session lows of Y131.68. Dollar-yen offers Y102.75 to Y103.00, main demand below Y102.00.
