Sign up to create alerts for Instruments,
Economic Events and content by followed authors
Free Sign Up Already have an account? Sign In
Quotes
All Instrument Types
- All Instrument Types
- Indices
- Equities
- ETFs
- Funds
- Commodities
- Currencies
- Crypto
- Bonds
- Certificates
Please try another search
💎 Reveal Undervalued Stocks Hiding in Any Market Get Started
Japanese Yen Extends Gains
www.investing.com/analysis/japanese-yen-extends-gains-200621168
Japanese Yen Extends Gains
By MarketPulse (Kenny Fisher) | Mar 30, 2022 07:12AM ET The Japanese yen continued to rebound and posted sharp gains for a second straight day. USD/JPY was trading at 121.80 in the European session, down 0.82% on the day.
Yen volatility continues
The yen continued to show sharp volatility. USD/JPY started the week with gains of 1.42% and breaking above the 125 level for the first time since August 2016. The yen clawed back and erased these losses, pushing below the 122 line.
The Bank of Japan started the yen’s slide on Monday when it intervened by making an unlimited bid for JGBs in order to cap 10-year rates at 0.25%. The BoJ extended this move until Thursday, and it worked well, as the 10-year yield was at 0.22%, with USD/JPY down sharply for a second straight day.
The BoJ managed to contain the selloff in the yen, but can the yen hold onto these gains? Much of the yen’s recent gains may be due to repatriation flows into Japan ahead of the financial year-end on Thursday. These repatriation flows could quickly reverse and push the yen to lower levels.
The BoJ’s intervention to defend the yield curve and keep benchmark yields at an upper limit of 0.25% was dramatic, and the Bank showed its determination to keep rates low and maintain a loose policy in order to kickstart the weak economy.
This put the BoJ out of sync with the Federal Reserve and other major central banks which were tightening policy in order to contain re-hot inflation. This will likely result in a widening of the US/Japan rate differential, which was bearish for the rate-sensitive yen.
The BoJ understandably was in focus this week, but there were other events on the economic calendar which warranted attention. Japan’s retail sales declined by 0.80%, marking a third successive month of losses. Price rises and COVID restrictions were weighing on consumer spending, which was dampening economic growth.
USD/JPY Technical
- 121.21 was providing support, followed by 119.98
- There was resistance at 123.32 and 124.55
Related Articles
March Going Out Like a Lamb After Wrestling With a Lion
By Marc Chandler - Mar 31, 2023
1
The banking stress that roiled the markets this month has eased. However, the emergency lending by the Federal Reserve, vias the discount window, and the new Bank Term Funding...
EUR/USD Bulls Want a Breakout Above March 23 High
By Al Brooks - Mar 31, 2023
3
The EUR/USD is Always In Long and will probably surpass the March 23rd high in the next day or two. The market will also probably test the February 1st buy-the-close bar. This was...
U.S. Dollar Stares into the Abyss
By Alexander Kuptsikevich - Mar 31, 2023
The dollar index is ending with a decline for the fourth of the last five weeks, almost completely erasing the gains from February's rise. Although it cannot be ruled out that the...
Japanese Yen Extends Gains
Add Chart to Comment
Confirm Block
Are you sure you want to block %USER_NAME%?
By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.
%USER_NAME% was successfully added to your Block List
Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.
Report this comment
I feel that this comment is:
Comment flagged
Thank You!
Your report has been sent to our moderators for review
Add a Comment
We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
Enrich the conversation, don’t trash it.
Stay focused and on track. Only post material that’s relevant to the topic being discussed.
Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.