With much of the Northern hemisphere gearing up for Christmas celebrations, currency movement is a little restrained.
That being said, the Yen was able to edge away from a recent five-year low against the US Dollar before the close of Australasian trading.
While the ‘Greenback’ continues to derive underlying support from last week’s shocking Federal Open Market Committee policy decision, the currency has slipped against rivals like the Yen due to the expectation that further ‘Buck’ gains will be limited before the New Year.
However, the US Dollar may recover losses if today’s University of Michigan Confidence index shows the improvement expected. US personal income/spending figures could also influence USD/JPY movement.
Meanwhile, the Yen began the European session in a weaker position against the Pound.
The British asset advanced on the majority of its currency counterparts after a Bank of England official intimated that the central bank would take action in order to limit the risk of a housing bubble.
Although tomorrow’s UK Nationwide housing report could have an impact on the GBP/JPY pairing, fluctuations are more likely to be driven by Japanese reports over the next five days.
The week is very data-light but there are a few reports to take note of, including Japanese inflation figures.
Economists expect Japan’s core consumer prices to have increased 1.1 per cent in November year-on-year, following October’s 0.9 per cent gain.
Although the unprecedented stimulus measures introduced by the Bank of Japan back in April have helped to increase inflation, achieving the central bank’s 2 per cent target still seems a long way off.
According to a Deutsche Bank AG report; ‘even though inflation is rising quickly in Japan – at least for Japanese measures – we think the central bank may decide to augment or extend quantitative easing around April next year.’
Other Japanese data to look out for this week includes the BOJ’s monthly economic report, the publication of minutes from the latest BOJ policy meeting, domestic housing starts and small business confidence figures.
Current Japanese Yen (JPY) Exchange Rates:
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The US Dollar/Japanese Yen Exchange Rate is currently in the region of: 103.9700 <
The Pound Sterling/Japanese Yen Exchange Rate is currently in the region of: 169.9880 >
The Euro/Japanese Yen Exchange Rate is currently in the region of: 142.1760 <
The New Zealand Dollar/Japanese Yen Exchange Rate is currently in the region of: 85.2018 <
The Australian Dollar/Japanese Yen Exchange Rate is currently in the region of: 92.8080 <
(Correct as of 10:10 GMT)
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