Yen Rebounds on Rate Hike Expectation Monday, September 18, 2006
The yen rebounded on the hawkish comment from Bank of Japan board member Atsushi Mizuno. He said in an interview published today that inflation and economy growth are in line with the central bank¡¦s forecast. He indicated that a commitment by the central bank to raise rates gradually does not mean the policy changes will be delayed. His comment attracted the market attention back to the BoJ rate hike issue and boosted the expectations for BoJ to raise rates sooner than previously anticipated. The minutes for the BoJ meeting in August also showed that the economy is expanding steadily and consumer prices will keep its positive trend.
The yen is supported by the speculation that the G7 meeting to be held this week in Singapore may discuss currency manipulation in Asia countries, such as China and Japan. It is uncertain yet whether US Treasury Secretary Henry Paulson will push China quicken the Chinese yuan appreciation at the meeting.
USDJPY encounters interim resistance at 118, backed by 118.30 and 118.50. Subsequent ceilings will emerge at 118.70, followed by 119. On the downside, support begins at 117.40, followed by 117 and 116.60. Additional floors are eyed at 116.20, backed by 116 and 115.70.
The yen is supported by the speculation that the G7 meeting to be held this week in Singapore may discuss currency manipulation in Asia countries, such as China and Japan. It is uncertain yet whether US Treasury Secretary Henry Paulson will push China quicken the Chinese yuan appreciation at the meeting.
USDJPY encounters interim resistance at 118, backed by 118.30 and 118.50. Subsequent ceilings will emerge at 118.70, followed by 119. On the downside, support begins at 117.40, followed by 117 and 116.60. Additional floors are eyed at 116.20, backed by 116 and 115.70.
Labels: Japnese Yen
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