Forex - USD/JPY hits 5-year peak on diverging BoJ, Fed policy outlooks
Investing.com
Published Dec 26, 2013 05:42AM ET
USD/JPY rose to a session high of 104.84, the highest since October 5, 2008, during European morning trade, before subsequently consolidating at 104.76, up 0.36%.
The pair was likely to find support at 104.13, the low from December 24 and resistance at 105.06, the high from October 5, 2008.
The yen weakened after minutes of the BoJ’s November policy meeting revealed that that not all board members were convinced that the country’s growth was on a long-term upward trend.
Investors also reacted to comments made by BoJ Governor Haruhiko Kuroda, who said that the nation’s economy hadn’t yet completely wiped out deflation.
Meanwhile, demand for the greenback remained supported amid expectations the U.S. economy will be strong enough to allow the Fed to continue withdrawing support through 2014.
The greenback strengthened last week after the Fed announced that it would reduce its USD85 billion-a-month bond buying program by USD10 billion in January, due to an improving economic outlook.
The U.S. was to release weekly data on initial jobless claims later in the day.
Elsewhere, the yen was also lower against the euro, with EUR/JPY rising to a session high of 143.53, the highest since October 2008. The pair was last up 0.48% to 143.42.
Trading volumes are expected to remain light as most market players are still off due to the Christmas holiday and as many traders already closed books before the end of the year.
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Written By: Investing.com
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