The Japanese Yen remained close to a recently struck 2-month peak versus the U.S. Dollar as well as the common currency Euro as investors await news from the U.S. Federal Reserve to gauge what the Fed’s next step might be. Analysts believe that the Fed chairman might have to address specifically the next measures to scale back the current asset purchasing scheme in order to curtail market hysteria and existing confusion. Market confidence has been severely eroded in the past weeks, a culmination of factors not the least of which is the uncertainty over the Fed’s upcoming policy meeting and disappointing in the Bank of Japan’s latest announcement. One analyst from JP Morgan wrote that the Fed must take the opportunity to deny that recent vague hints at reining in the program were intended to trigger fixed income markets’ repricing.
As reported at 11:38 a.m. (JST) in Tokyo, the USD/JPY pair was trading at 94.23 Yen, relatively unchanged from late trading in New York on Friday and which followed a fall of 3.4% last week. The EUR/JPY pair was trading near to last week’s 2-month low of 124.94 Yen and was holding earlier at 125.81 Yen. Against the Australian Dollar, the Yen traded at 90.23 Yen, after hitting a 5-month low when the AUD/JPY pair fell to 88.90 Yen. The EUR/USD pair was trading at $1.3347, very near to Thursday’s 3½ month high when the pair touched on $1.3390.