20 Mar 2014
USD/JPY attempted the 55 DMA, significant? - BTMU
FXStreet (Guatemala) - FX Strategists at the Bank of Tokyo Mitsubishi UFJ explained the US dollar has strengthened against the yen following the less dovish than expected FOMC meeting lifting USD/JPY back towards resistance from its 55-day moving average at just above 102.80.
Key Quotes
"Rising US yields driven by investor expectations of earlier and more Fed funds rate hikes ahead are helping to lift USD/JPY."
"However, the heightened prospect of Fed monetary tightening is also weighing upon global risk assets boosting safe haven demand for the yen in the near-term although Japan’s elevated trade deficit is diminishing its appeal. Emerging market and commodity linked currencies are the most vulnerable to a further rise in US yields especially those with elevated current account deficits. Slowing growth in China and uncertainty related to developments in the Ukraine also continue to support the yen."
Key Quotes
"Rising US yields driven by investor expectations of earlier and more Fed funds rate hikes ahead are helping to lift USD/JPY."
"However, the heightened prospect of Fed monetary tightening is also weighing upon global risk assets boosting safe haven demand for the yen in the near-term although Japan’s elevated trade deficit is diminishing its appeal. Emerging market and commodity linked currencies are the most vulnerable to a further rise in US yields especially those with elevated current account deficits. Slowing growth in China and uncertainty related to developments in the Ukraine also continue to support the yen."