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2 Apr 2013
Forex Flash: Yen rebound continues ahead of BoJ meeting - BTMU
FXstreet.com (Barcelona) - Lee Hardman, FX analyst at the Bank of Tokyo Mitsubishi UFJ notes that the yen has continued to strengthen ahead of this week’s key BoJ monetary policy meeting with USD/JPY breaking back below its 55-day moving average for the first time since mid-October.
He feels that it is a further technical signal that the Yen weakening trend has clearly lost momentum over the past month after USD/JPY hit an intraday high of 96.71 on March 12th. Further, he adds that the yen´s ongoing rebound against USD extended yesterday following the weaker than expected economic data from the US.
The ISM manufacturing survey revealed business confidence declined sharply to 51.3 in March from 54.2 in February pointing to a more marked slowdown in manufacturing activity heading into Q2. He believes that the US economy appears set to expand by an annualized rate of around 3.0% in Q1 after expanding by just 0.4% in Q4 2012. He writes, “The weaker ISM manufacturing survey supports our view that US growth will ease again in Q2 as the headwind from the sequester spending cuts start to bite weighing upon USD/JPY over the next three months.”
He feels that it is a further technical signal that the Yen weakening trend has clearly lost momentum over the past month after USD/JPY hit an intraday high of 96.71 on March 12th. Further, he adds that the yen´s ongoing rebound against USD extended yesterday following the weaker than expected economic data from the US.
The ISM manufacturing survey revealed business confidence declined sharply to 51.3 in March from 54.2 in February pointing to a more marked slowdown in manufacturing activity heading into Q2. He believes that the US economy appears set to expand by an annualized rate of around 3.0% in Q1 after expanding by just 0.4% in Q4 2012. He writes, “The weaker ISM manufacturing survey supports our view that US growth will ease again in Q2 as the headwind from the sequester spending cuts start to bite weighing upon USD/JPY over the next three months.”