The pair is likely to trade with a firm undertone today in Asia on bets that the main opposition LDP, which is advocate of a powerful monetary easing, would win the Dec. 16 election. The rate reached Y83.30, the highest since April 2, also on speculation that the BOJ, which will hold a policy board meeting on Dec. 19 and 20, will take additional monetary easing following the snap election. Meantime, overall risk sentiment will remain buoyant after the Fed decided to buy more Treasuries and maintain interest rates at low levels as long as the unemployment rate remains above 6.5% and if inflation between one and two years ahead is projected to be no more than 2.5%. Meantime, investors will also watch closely U.S. budget talks after Fed Chairman Ben Bernanke said fiscal cliff is creating uncertainty and pessimism in the U.S. and that short-term descend off fiscal cliff would be costly. The rate moved from Y82.47 to Y83.30 on Wednesday.
EasyForexNews Research Team