Dollar-yen closed Wednesday in NY at Y87.93 after rate had seen a recovery off early Asian lows of Y86.83 to a high of Y88.02 during the US session, before edging off a late pullback low of Y87.75 into the close. Japanese demand into the Asia open extended this recovery, some suggesting it was in reaction to a local press report suggesting the BOJ will embark on further easing at the next meeting on Jan22, the bank mulling a 2.0% inflation target as well as adding Y10tln to the asset buying program, with triggered stops through Y88.10 taking the rate on to an overnight high of Y88.22. Rate drifted back to test the broken NY high at Y88.02 before fresh demand emerged to lift rate back to the Y88.20 area. However, Asian traders have noted sell interest placed from above Y88.20 and said to extend to Y88.50 and expected to make further upside progress sticky. Euro-yen was dragged higher by the dollar-yen move but euro weakness ahead of today’s ECB meeting was seen applying brakes to upside progress. Traders overnight noted offers in the cross at Y115.15.
EasyForexNews Research Team