The response to the Bank of Japan’s intervention yesterday was short-lived, and following profit-taking traders are already pushing the safe haven currency higher against the U.S. Dollar during the Asian trading session. As reported at 1:50 p.m. (JST) in Tokyo, the USD/JPY pair was trading at 78.29 Japanese Yen, a loss of 0.1% and coming off a 1-month peak of 79.23 Japanese Yen which was set yesterday just after the BOJ announced its newest attempt at curtailing the Yen’s steady rise. Currency analysts expect the pair to trade within a relatively tight trading band over the next few weeks, holding between 77 Japanese Yen and 79 Japanese Yen.
A lackluster report on Chinese manufacturing weighed against commodity currencies such as the Australian Dollar, though the New Zealand Dollar found some support from upbeat data. The AUD/USD pair fell 0.6% to $1.0417, after the HSBC PMI reading showed only a fractional improvement from August’s 9-month low, holding firm in contractionary territory. The New Zealand Dollar, which generally does feel the effects of negative Chinese data, was offset by the news that GDP improved in the second quarter to 0.6%, double expectations; the NZD/USD pair was trading at $0.8258, slipping from an earlier high of $0.8303.