Yen Trend Intact Despite Small Break

The Japanese Yen got some respite during the Asian trading session though investors remain convinced that the safe haven currency is due for a significant fall with the Bank of Japan’s policy meeting ahead next week. Earlier in the session the USD/JPY pair had struck a 4-month low but has eased up slightly since though it will likely post a second consecutive week of losses.

As reported at 12:57 p.m. (JST) in Tokyo, the USD/JPY pair was trading at 80.13 Yen, a loss of 0.2% and off the session high of 80.38 Yen. Analysts believe that a break of 80.63, the June peak, could take the pair back to high levels not seen since late April. The EUR/JPY pair was also lower at 103.79 Yen, a drop of 0.1% coming off a 5-month high of 104.59 Yen struck yesterday.

In the short term, analysts expect some Yen weakness as a factor of the BOJ’s expected easing measures, but over the medium term there is still great uncertainty about what efforts the Japanese government will undertake in respect to the macro economic factors. Earlier today, the Japanese cabinet approved a $5.3 billion (equivalent) stimulus plan consisting of tax grants and subsidies.