The pair is likely to trade in a tight range today in Asia, before the Bank of Japan concludes a two-day policy board meeting. The BOJ is widely expected to stand pat on policy guidance today after having eased the monetary policy for a second month in row in October, but investors focus on remarks at a post-meeting press conference by BOJ Governor Masaaki Shirakawa amid increased political pressure. The yen reached a seven-month low of Y81.59 on Monday as Shinzo Abe, the head of the LDP, has been urging the Japanese central bank to do more since the lower house was dissolved last week to hold a national election on Dec. 16. Meantime, investors will also focus on today’s meeting of EU finance ministers amid speculation that they will approve disbursement of E44 billion financial aid for the debt-laden Greece. Both the yen and dollar will underperform riskier currencies, as optimism about Greece and forecast-beating existing home sales data in the U.S. boosted risk sentiment. The Standard & Poor’s 500 Index rose for a second straight trading day, up 1.99% on Monday, while yields on Treasury’s 10-year notes surged three basis points to 1.61%. The rate moved from Y81.09 to Y81.59 on Monday.
EasyForexNews Research Team