By TraderVox.com
Tradervox.com (Dublin) – The Japanese currency strengthened against most of its major peers after the Bank of Japan refrained from additional stimulus. The yen rallied from more than two weeks low against the dollar. The yen advanced against the euro as Mario Draghi indicated that the European Central Bank is waiting for the Spain to fulfill the requirements for bond buying. According to Minori Uchida, Tokyo-based Chief Analyst at the Bank of Tokyo-Mitsubishi, the market has been disappointed a bit by the BOJ’s inaction. The BOJ meeting was graced by Japan Economic Minister Seiji Maehara, who wanted to express his discontentment with the current exchange rate. Maehara is the first Minister in nine years to participate in the BOJ meeting.
The yen has dropped by 0.5 percent against the dollar this week while the euro has advanced by 1.2 percent since September 28. The Bank of Japan indicated in statement today that it would keep its asset purchases program at 55 trillion yen after adding 10 trillion in the last meeting. The next BOJ meeting will be on October 30. According to Takuya Kawabata, the decision by the ECB was welcomed by the market as risk aversion has receded hence the firm euro. Kawabata is a currency researcher at Gaitame.com Research Institute.
Japanese currency advanced against the dollar by 0.2 percent to trade at 78.36 yen at the close of trading in Asian session. The yen had close the day yesterday in London at 78.48 when it touched its lowest since September 19 of 78.72. The yen rose marginally against the euro to trade at 101.98. The 17-nation currency was little changed against the dollar at 1.3014. It touched it highest level since September 21 of 1.3032 yesterday during the London trading session.
According to Richard Adcock, the euro is expected to test the $1.3031, the 61.8 percent retracement from the Fibonacci graph, from a low of $1.2804 last seen on October 1 to the Sept 17 high of $1.3172. Adcock is a technical analysts based in London at UBS.
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