The US Dollar was trading within the region of a 3-week week low against the Yen as the European session began after the Asian currency extended gains recorded last week and the American currency softened.
The Japanese Yen exchange rate was in the region of 100.1500 Yen to one US Dollar as of 11:05 am GMT
While Japanese shares dropped as a result of a stronger Yen, more positive-than-expected data for China and the Eurozone pushed investors towards higher risk assets and weakened the safe-haven ‘Greenback’.
However, the Yen continues to trade just above the psychological ¥100 per Dollar level and could resume its previous downward trajectory if Friday’s US non-farm payrolls figure is strong.
A good employment figure could prompt the Federal Reserve to begin reining in its present level of stimulus, a circumstance which would strengthen the US Dollar and allow it to turn bullish against peers like the Yen.
However, according to a recent report compiled by a Washington think-tank, the Yen’s recently halted run of declines occurred too rapidly, overshooting the levels justified by fundamental market/economic conditions by nearly 10 per cent.
The report stated: ‘The sharp and rapid decline of the Yen […] suggests that if the Yen continues much further along a downward path, the G-7 [group of seven large industrial economies] may need to consider coordinated intervention to stem the decline of the currency.’
Additional movement could occur in the USD/JPY pairing in the hours ahead as a result of US ISM manufacturing data. Economists have forecast that the gauge of manufacturing will come in at 50.7 in May, unchanged from the previous month.
According to one New-York based industry expert: ‘It’s a pause in manufacturing. There is still domestic demand. The housing recovery is continuing, and in fact, accelerating. Manufacturing isn’t likely to go down a lot.’
However, a better-than-expected result could allow the US Dollar to gain ahead of Friday’s influential non-farm payrolls report.
Current Japanese Yen (JPY) Exchange Rates:
< Down > Up
The US Dollar/Japanese Yen Exchange Rate is currently in the region of: 100.1500 <
The Pound Sterling/Japanese Yen Exchange Rate is currently in the region of: 152.9170 >
The Euro/Japanese Yen Exchange Rate is currently in the region of: 130.5360 >
The New Zealand Dollar/Japanese Yen Exchange Rate is currently in the region of: 79.9173 >
The Australian Dollar/Japanese Yen Exchange Rate is currently in the region of: 96.4845 <
(Correct as of 11:05 GMT)
Comments are closed.