JAPANESE SMASHES 18 MONTHS TO STAY HIGH AGAINST DOLLAR

JAPANESE SMASHES 18 MONTHS TO STAY HIGH AGAINST DOLLAR

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JAPANESE SMASHES 18 MONTHS TO STAY HIGH AGAINST DOLLAR

– Yen hits 18-month high against U.S. Dollar

– Japanese currency stays firm after BOJ skips easing

JAPANESE SMASHES 18 MONTHS TO STAY HIGH AGAINST DOLLAR
Mitul Kotecha

JAPANESE SMASHES 18 MONTHS TO STAY HIGH AGAINST DOLLAR

On Friday, the Yen projected an 18-month high against the dollar.

This was following the Bank of Japan’s decision to back off from increasing its monetary stimulus.

Dollar slumped as low as 107.075 Yen. And his has been the denomination’s weakest level since October 2014.

The dollar traded last at 107.37 yen JPY=, down 0.7% on the day, succeeding on from a 3.0% fall on Thursday.

According to Reuters, the dollar’s drop gained momentum after it breached a low of 107.63 yen set earlier in April. Momentum and Technical s probably played a part in exaggerating moves, traders said.

JAPANESE SMASHES 18 MONTHS TO STAY HIGH AGAINST DOLLAR

“I think a combination of follow-through from yesterday’s BOJ decision plus the softer dollar tone has weighed on Dollar or Yen as well,” said Mitul Kotecha, head of Asia FX and rates strategy for Barclay’s in Singapore.

“There’s very little to stop Dollar or Yen continuing to trade lower especially given the dollar itself has really lost a lot of momentum,” he added.

The Yen also surged against the Euro, which fell 0.4% to 122.295 Yen. On Thursday, the euro had shacked 2.7 percent versus the yen.

Forcing of the yen’s profits may make Japanese policymakers anxious. Meanwhile, analysts were on the watch out for efforts by Japanese officials to underestimate the currency.

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The financial markets of Japan were closed for a public holiday on Friday.

“Outright intervention remains unlikely unless price action gets truly disorderly,” analysts at BNP Paribas wrote in a note to clients.

“However, we would expect MOF officials to continue to signal that intervention is available to counter disorderly moves and for BOJ officials to remind markets of their willingness to ease further.”

According to data released on Thursday, it was confirmed that were many suspicions concerning U.S. economic growth closely.

Not helping the greenback, data released on Thursday confirmed what many already suspected, that U.S. economic growth nearly stuck in the first quarter.

JAPANESE SMASHES 18 MONTHS TO STAY HIGH AGAINST DOLLAR

The economy grew at a paltry 0.5% annualized pace, falling abruptly from 1.4 percent.

Following this information, the Federal Reserve might not be hurried to convey the next hike in rates, traders said.

Accentuating the dollar’s soft tone, the euro rose 0.3% against the dollar to $1.1.

The Australian dollar also heaved 0.3% against the greenback to $0.7644.

JAPANESE SMASHES 18 MONTHS TO STAY HIGH AGAINST DOLLAR

There was little in the way of market-moving data out of Asia on Friday. China’s official survey on manufacturing activity due on Sunday should set the tone for early next week. Reuters published.