FXTM information and reviews
OctaFX information and reviews
XM information and reviews
FXCC information and reviews
Libertex information and reviews
FxPro information and reviews

Yen underwhelmed as BOJ jumps on unlimited bandwagon

27 April 2020

The Japanese Yen initially breached the 107.3 level against the US Dollar, only to pare gains, after the Bank of Japan pledged unlimited buying of government bonds and agreed to raise its holdings of corporate debt to 20 trillion Yen. However, the BOJ has maintained its policy rate at minus 0.1 percent, while forecasting a GDP contraction between -5 to -3 percent for the year.

The relatively muted reaction in the Yen is perhaps because the announcement is seen as having little material impact on bond markets, with the BOJ’s purchasing momentum lagging behind its previous target of 80 trillion Yen prior to Monday's pledge for "unlimited" purchases. This has fuelled criticisms that the BOJ has not been keeping up in ensuring enough policy support to curtail the economic damage left by the coronavirus outbreak. The central bank is also mindful of its limited policy space, while not lending too much upward pressure on the Japanese Yen, as export activities could be curtailed by a stronger JPY.

Markets could have another chance to react during BOJ Governor Haruhiko Kuroda’s press conference later today.

Central banks in race to unleash support measures

Stil, the BOJ’s Monday announcement was in line with other major central banks, such as the Federal Reserve and the European Central Bank, who have used unprecendented monetary policy measures to support their respective economies in the wake of Covid-19. The BOJ likely moved ahead of the ECB and Fed’s scheduled policy decisions later this week, in order to not be seen as lagging behind its major peers when rolling out more supportive measures, in which case could have resulted in a massive Yen surge.

The BOJ announcement also failed to excite EURJPY, which is holding steady around the 116.3 mark. The European Central Bank, which has a policy decision due Thursday, is widely expected to ramp up its emergency bond-buying programme over the coming months. This year, the ECB could end up buying over 1.5 trillion Euros worth of assets to support the EU economy that is set to see the sharpest recession in its history.

Despite EURJPY having clawed its way back up in recent sessions, it should not detract significantly from the overall downward bias for the Euro, amid forecasts of a EU economyic contraction of up to 15 percent this year, versus the overall risk aversion that is set to be supportive for safe haven assets, such as the Japanese Yen.




USD/JPY sticks to its consolidative theme
USD/JPY sticks to its consolidative theme

USD/JPY remains side-lined for the time being, note FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang. Yesterday, we highlighted that ‘upward momentum has slowed and USD is unlikely...

5 Aug 2022

USD/JPY pares intraday losses to multi-week low
USD/JPY pares intraday losses to multi-week low

USD/JPY stages a goodish bounce from a multi-week low touched earlier this Friday. Recovering US bond yields help revive the USD demand and offers support to the pair...

29 Jul 2022

The Yen updated the lows
The Yen updated the lows

USDJPY reached new highs – the “greenback” continues to get stronger. The Japanese Yen plunged against the USD. The current quote for the instrument is 137.02. A new high for the pair is at 137.28....

11 Jul 2022

The Yen may drop
The Yen may drop

USDJPY is preparing a new attack on the highs. The Japanese Yen is slowly falling against the USD. The current quote for the instrument is 136.16. The statistics published...

8 Jul 2022

200-hour SMA, around 135.60 might continue to cap the upside
200-hour SMA, around 135.60 might continue to cap the upside

USD/JPY recovered a few pips from the daily low, though lacked any follow-through buying. Ascending trend-line breakdown and failure near the 200-hour SMA favours bearish traders...

4 Jul 2022

The Yen hit new lows
The Yen hit new lows

USDJPY updated its 24-year highs and may continue rising. The Japanese Yen hit a new 24-year low against the USD. The current quote for the instrument is 136.25. The high in USDJPY...

22 Jun 2022

HFM information and reviews
IronFX information and reviews
FXCM information and reviews
Pepperstone information and reviews
NordFX information and reviews
LegacyFX information and reviews

© 2006-2022 Forex-Ratings.com

The usage of this website constitutes acceptance of the following legal information.
Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website (reviews, brokers' news, comments, analysis, quotes, forecasts or other information materials provided by Forex Ratings, as well as information provided by the partners), including graphical information about the forex companies, brokers and dealing desks, is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Forex Ratings shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about the forex companies. The entire responsibility for the contents rests with the commentators. Reprint of the materials is available only with the permission of the editorial staff.
We use cookies to improve your experience and to make your stay with us more comfortable. By using Forex-Ratings.com website you agree to the cookies policy.