Yen declines. The US dollar soars despite the debit crisis. Following today’s increase in domestic PPI ahead of CPI, the Japanese Yen fell.
The yen fell due to BoJ’s rising inflationary pressures
While the Australian and New Zealand Dollars modestly strengthened following the US Dollar’s significant gains this past Friday, the Japanese Yen continued to decline today.
Japanese PPI came in higher than predicted at 5.8% Y to Y basis through the end of April as opposed to the predicted 5.6%. This Thursday, the country’s CPI is scheduled to be released, and according to a Bloomberg poll of experts, the yearly overall figure will rise to 3.5% from the previous 3.2%.
The Bank of Japan’s decision to maintain its loose fiscal stance may be called into doubt by increasing pricing pressure.
Asian equities decline before Chinese data and Fed hints. The Japanese Yen (JPY), a safe-haven currency. It is undercut by the overall bullish sentiment in the stock markets and the Bank of Japan’s (BoJ) dovish position. Which ultimately serves as a headwind for the USDJPY cross.
It is important to remember that BoJ Governor Kazuo Ueda stated previously. During an address in parliament said it was premature to talk about precise departure strategies for the extensive rescue package.
Earlier today, the People’s Bank of China (PBOC) added 25 billion Yuan in liquidity. While keeping its medium-term credit facility (MLF) rate at 2.75 percent.
Although the statistic, there was little movement in the APAC stock markets on Monday, and futures indicate to a flat opening to the Wall Street day. Despite this, the TOPIX index for Japan is currently trading close to its 30-year high.
TECHNICAL ANALYSIS OF THE USDJPY PAIR
As long as USD/JPY stays above a few rising trend lines, it has continued to increase from the previous week’s gains.
The 200- and 260-day SMAs are above the price. Despite the fact that they crossed over a number of short- and medium-term daily (SMA). This may imply that longer-term trend signs are yet to verify it. Immediate and medium-term positive momentum may be developing.
The prior highs at 137.77, 137.91, and 138.18 might serve as resistance. Support was located at the current bottom of 133.75, 133.50, and 133.00 on the negative.
