Dual Mandate Policy Proposal Sinks Yen
The Japanese Yen fell to a multi-year low against the U.S. Dollar during the Asian trading session following new comments made by the Prime Minister who indicated that the Japanese central bank should include the maximization of employment as one of its policy goals along with its mandate to ensure price stability. If the Bank of Japan agrees, this dual mandate policy, which is very similar to that of the U.S. Federal Reserve, is expected to yield even more aggressive stimulus measures.
As reported at 12:55 p.m. (JST) in Tokyo, the USD/JPY pair had traded at a high of 89.04 Yen, a level not seen since July 2010; currently, the pair is trading lower at 88.06. Some traders anticipate that the pair is likely to rise above 90.00 Yen in the near term.
In the Eurozone, markets were anxious to hear whether ECB head Mario Draghi would drop some hints of a rate cut during his customary press conference which follows a policy decision. In the end, Euro bears were disappointed by the comments while bulls took swift advantage of the 1.6% gain of the EUR/USD pair, which was the largest single day’s gain in several months; currently the pair is trading at $1.3262, off the session peak of $1.3271.
- Currency Pairs