Opened in Asia at Y80.12 and grinded higher to Y80.20 in light volumes, hampered by a Tokyo holiday, as Japan continued to enjoy Golden Week. Dollar ran into offers from exporters and settled in a tight 10 pip range for the remainder of the session. EUR/JPY was also quiet ahead of the ECB policy meeting in Barcelona, unable to break out of a Y105.31-48 range. USD/JPY lifted to Y80.27 in early European trade and extended gains to Y80.34 on cross demand, before running into exporter supply and easing to Y80.26. The pair jumped to Y80.40 on late headlines that Japan’s credit rating may slip if public debt continues to rise and heads into NY on a more buoyant tone than of late. EUR/ JPY headed higher on the open to Y105.55 but pared early gains in thin markets. Strong demand met in the dip and the cross tracked EUR/USD recovery to highs of Y105.72, later easing on profit take sales. The cross extended losses on release of weaker than expected UK Services PMI data, before spiking to Y105.60 on the earlier mentioned Japan credit rating headline.
EasyForexNews Research Team