Will Bank of Japan Intervene? Investors Unsure, Yen Fluctuates

The Japanese yen fluctuated today, staying nearly flat at present, as Forex market participants were unsure whether the Bank of Japan would intervene to trim yen’s gains.

The crisis in Europe is hurting Japan’s economies in several ways. First, it weakened demand for the nation’s exports from European countries. Second, the crisis boosted demand for the safety of the yen, helping the currency to rebound from the March lows. Analysts say that the BoJ is likely to intervene as the impact of the previous easing measures is waning. On the other hand, central bank’s Governor Masaaki Shirakawa said that monetary policy has limited ability to support an economy. The statement made traders wonder: is the BoJ really keen to intervene?

Another factor that is adding to uncertainty is today’s monetary meeting of the US Federal Reserve. Speculators and market analysts will look into the policy statement after the meeting for signs of future quantitative easing. The members of the Federal Open Market Committee previously were divided in their opinion whether the US economy needs additional stimulus, making it uncertain whether QE3 would happen.

USD/JPY traded at about 81.38 as of 15:09 GMT today, following the advance to 81.56 and the fall to 81.07, while the opening price was 81.30. EUR/JPY was near it opening level of 107.29, while intraday high was 107.65 and the low was 107.12. GBP/JPY stayed flat at 131.23.

USD/JPY Gains as Fed Does Not Mention QE3

The US dollar gained against the Japanese yen today before retreating to the opening level as the Federal Reserve refrained from adding stimulus to the US economy. The currency remained lower versus the euro and the Great Britain pound.

Some analysts anticipated some dovish remarks from the Fed today. Such expectations didn’t come true as the Federal Open Market Committee said in its statement:

The Committee expects economic growth to remain moderate over coming quarters and then to pick up gradually.

The FOMC remained rather neutral in the statement, mentioning an improvement of employment and housing

markets, but saying that “the unemployment rate has declined but remains elevated” and ”the housing sector remains depressed”. The Committee maintained its main interest rate stable near zero and reiterated the pledge to keep rates low till late 2014.

The reaction of the dollar wasn’t as strong as might expect. The greenback climbed against the yen, but later retreated. The pound and the euro were almost unfazed by the monetary decision.

USD/JPY climbed from 81.30 to 81.69 before trading at 81.34 as of 20:08 GMT today. EUR/USD was up from 1.3195 to 1.3218 and GBP/USD went higher from 1.6142 to 1.6170.

Aussie Goes Down as CPI Growth Below Expectations

The Australian dollar fell today as a government report showed that nation’s consumer prices rose in the last quarter far slower that was anticipated by market analysts, triggering speculation about an interest rate cut.

Australia’s Consumer Price Index rose 0.1 percent in the first quarter of 2012, while much bigger growth by 0.7 percent was predicted by economists. The trimmed mean CPI (core CPI) increase 0.3 percent, while forecasters said that it would stay at 0.6 percent as in the the fourth quarter of 2011. The slowing inflation added incentive for the Reserve Bank of Australia will reduce interest rates. The problems in Europe also reduce demand for the Aussie, as well as other currencies with higher yield.

AUD/USD fell from 1.0321 to 1.0310 as of 14:35 GMT today, following the drop to 1.0246 — the lowest level since April 11. AUD/JPY was down from 83.76 to 82.85 before trading at 73.68.

If you have any questions, comments or opinions regarding the Australian Dollar, feel free to post them using the commentary form below.

Aussie Goes Down as CPI Growth Below Expectations

The Australian dollar fell today as a government report showed that nation’s consumer prices rose in the last quarter far slower that was anticipated by market analysts, triggering speculation about an interest rate cut.

Australia’s Consumer Price Index rose 0.1 percent in the first quarter of 2012, while much bigger growth by 0.7 percent was predicted by economists. The trimmed mean CPI (core CPI) increase 0.3 percent, while forecasters said that it would stay at 0.6 percent as in the the fourth quarter of 2011. The slowing inflation added incentive for the Reserve Bank of Australia will reduce interest rates. The problems in Europe also reduce demand for the Aussie, as well as other currencies with higher yield.

AUD/USD fell from 1.0321 to 1.0310 as of 14:35 GMT today, following the drop to 1.0246 — the lowest level since April 11. AUD/JPY was down from 83.76 to 82.85 before trading at 73.68.

If you have any questions, comments or opinions regarding the Australian Dollar, feel free to post them using the commentary form below.

Euro is mostly rangebound today, making small gains against the US dollar, after a Dutch bond auction proved reasonably successful. The euro has been struggling lately due to concerns about the political stability of eurozone countries, as well as continued worries about Spain.

Japanese yen is mixed today as Forex traders look for direction. There is a lot to think about today, in terms of news and forecasts, and currencies are part of the confusion. Yen has slipped against the euro after choppy trading, but is higher against the pound and the dollar.

Euro Rangebound in Forex Trading

Euro is mostly rangebound today, making small gains against the US dollar, after a Dutch bond auction proved reasonably successful. The euro has been struggling lately due to concerns about the political stability of eurozone countries, as well as continued worries about Spain.

The Great Britain pound rose today against the US dollar after a report showed that confidence of Britons unexpectedly improved last month, muting speculations about quantitative easing from the Bank of England. The currency was down against the Japanese yen.

The Great Britain pound rose today against the US dollar after a report showed that confidence of Britons unexpectedly improved last month, muting speculations about quantitative easing from the Bank of England. The currency was down against the Japanese yen

GBP/USD Higher as Consumer Confidence Improves

The Great Britain pound rose today against the US dollar after a report showed that confidence of Britons unexpectedly improved last month, muting speculations about quantitative easing from the Bank of England. The currency was down against the Japanese yen.

Euro Struggles on Weak Sentiment Data

Euro is struggling this morning, thanks in large part to weak sentiment data. Losses have been limited, though, by the information out of the United States about what could happen next with the Federal Reserve. As a result, the euro is hovering around the level of its open, and struggling to move much higher.

Swedish Consumer Confidence Rises, Krona Follows

The Swedish krona climbed today against most major currencies after a report showed that confidence on Swedish households improved this month, reducing probability of a next interest rate cut by the nation’s central bank.