Yen Weakens on Iwata, FX Major Pairs Mostly Steady - 28.10.2013
Currency markets on Monday were mostly steady following a week of increased volatility, perhaps this week could also develop to one like the previous. Investors are looking ahead for Fed’s two day meeting ending on Wednesday, US ADP report, NZD Cash Rate and Japan’s Monetary Statement on Thursday. Thus the week could develop to an interesting one despite reluctant initiation.
The US dollar against the Japanese was the biggest mover early on Monday as the Yen weakened after Deputy Governor of the BoJ, Kikuo Iwata, repeated central bank’s commitment to aggressive monetary policy for achieving 2% inflation figure. The USDJPY jumped creating a gap at the open, suggesting upside bias is likely to remain strong in the intraday. Risk appetite was strong during Asian session lifting Nikkei 225 by 2.19% to 14,396, Hang Seng also rose by 0.50% as Chinese fears over monetary tightening consequences ease.
USDJPY
The Australian dollar against the US dollar was underpinned by recovering stock indices and bounced up slightly to 0.9615. On Friday session the support at 38.2% of 0.9281 to 0.9752, at 0.9575 managed to maintain ground and a potential double bottom is formed with neckline at 0.9623, creating chances for upside resumption.
AUDUSD
The European currencies remain in range trading style with the EURUSD fluctuating between 1.3830/1.3775 and the GBPUSD in 1.6252/1.6125. Investors would stay focus on Fed’s meeting and for that reason we anticipate range trading to persist in the pairs unless German Consumer Sentiment surprise us tomorrow, while on Wednesday Spanish flash GDP release is expected to display increase by 0.1% in the q3, more than that would strongly underpin the Euro.