The Japanese yen climbed up against its significant counterparts in the European session on Wednesday, ahead of the Bank of Japan’s policy decision due tomorrow, which is anticipated to keep its rates and yield-curve policy the same.
The BoJ is most likely keep rates steady at -0.1 percent and target the yield of 10-year government bonds at around no percent.
The reserve bank targets to purchase federal government bonds so that the balance of its holdings increases at an annual speed of 80 trillion yen.
Investors remained careful ahead of the monetary policy result from the United States Federal Reserve and the Dutch election vote today.
Analysts believe the U.S. Federal Reserve will raise rates of interest later Wednesday, but there is much uncertainty about the outlook for further tightening. It is hoped that Fed Chair Janet Yellen will shed some light at her interview following the decision.
Figures from the Ministry of Economy, Trade and Market showed that Japan’s commercial production declined less than at first estimated in January.
Industrial production fell 0.4 percent month-over-month in January instead of a 0.8 percent drop approximated earlier. It was the very first decline in six months.
The yen has been selling a positive territory in the Asian session, with the exception of the pound.
In European trading, the Japanese yen rose back to 121.75 versus the euro, from an early low of 122.02. The yen had already set a 5-day high of 121.64 early in the Asian session. On the advantage, the yen may find resistance around the 120.00 mark.
European Reserve bank Executive Board member Peter Praet said that euro location inflation is being owned by energy and food prices and underlying cost pressures stay subdued, implying that there was no requirement for a modification in the present financial policy stance.
“Browsing recent volatility, the inflation outlook does not at this phase call for a reassessment of the present financial policy position,” Praet said in a panel discussion at the G-20 conference in Frankfurt.
Reversing from an early low of 114.88 against the greenback, the yen edged as much as 114.58. If the yen extends increase, it might find resistance around the 112.00 zone.
The yen rebounded to 113.58 against the Swiss franc, from a low of 113.86 hit at 11:00 pm ET. This might be compared with a 2-day high of 113.41 hit at the beginning these days’s trading. The next possible resistance for the yen is seen around the 111.00 level.
The yen reversed from an early near a 2-week low of 140.60 against the pound, edging greater to 139.78. The yen is seen finding resistance around the 136.00 region.
Information from the Office for National Statistics revealed that the UK jobless rate was up to the lowest level because 1975 at the start of the year.
The ILO unemployment rate was available in at 4.7 percent in 3 months to January versus 5.1 percent seen a year earlier.
The yen was trading higher at 85.19 versus the loonie and 79.54 against the kiwi, up from an early low of 85.32 and a 5-day low of 79.70, respectively. Additional gains might take the yen to resistance levels of around 84.00 against the loonie and 78.00 against the kiwi.
Looking ahead, New York Fed’s empire production information for March, U.S. customer rate index and retail sales for February, NAHB real estate market index for March and service stocks for January, as well as Canada existing house sales for February are due in the New york city session.
The material has actually been provided by InstaForex Company – www.instaforex.com