The pair closed in NY Y100.73 after rate had corrected back from recovery highs of Y101.80, the move up seen prompted by a comment from the Japanese GPIF is considering a more flexible approach to allocations (more investment in domestic stocks) as it boosted Nikkei futures, only for the release of weaker than forecast US jobless claims, and a slight revision in headline Q1 GDP, knocked dollar lower. This along with reports that end month models suggest strong sell signals for dollar-yen weighed on the rate and took it back to Y100.59. The recovery off this low continued into Asia, the rate pushing up to Y101.28 before momentum faded and rate drifted lower. The IMF, in its annual assessment, concluded that the yen is undervalued. This provided an added boost to the yen as the rate eased back to Y100.85. A recovery to Y101.09 was greeted with another round of decent sales which has taken the rate down to the Y100.80 area into Europe. Strong demand interest remains around the Y100.50/40 area with stops below, whilst main sell interest seen at Y101.70/102.00. Yen moves continue to be dictated by the Nikkei/yield plays.
