During the Asian trading session, the U.S. Dollar slipped from a recently struck multi-year peak after investors booked profits in the wake of the recent Dollar rally, however analysts confirm that in light of the Bank of Japan’s aggressively loose monetary policy that the Dollar’s decline is certain to be short-lived. The Japanese Yen has been sold relentlessly since November as Japan’s newest regime, led by Prime Minister Shinzo Abe, is adamant that monetary policy must aggressively change in order to put a stop to the deflationary trend. Abe has indicated that the USD/JPY price could be allowed to rise to the 100.00 Yen level, which is giving rise to talk among foreign policy makers of an impending currency war.
As reported at 12:11 p.m. (JST) in Tokyo, the USD/JPY pair was trading at 90.8750 Yen, mid-point between the day’s range of 90.3030 Yen and 91.1835 Yen. Meanwhile, the EUR/USD pair had also edged lower from Friday’s 11-month peak, but market players had expected that the recent uptrend of the Euro would soon continue and that the psychological barrier of $1.35 is likely to soon be breached. Currently, the pair is trading higher at $1.3453 not far from the session high of 1.3461.