The Japanese Yen moved higher against the Euro on profit taking ahead of the weekend. According to analysts, investors’ expectations that the Bank of Japan might increase their pace of quantitative easing has been running low and boosting the Yen’s strength relative to its peers. The release of Japan’s CPI data which unexpectedly jumped 3.2% last month also tended to weigh against the likelihood of additional easing.
As reported at 1:26 p.m. (JST) in Tokyo, the EUR/JPY traded at 138.14 Yen, moving away from a 4-month trough at 137.978 Yen, but is still likely to close down the week lower, for the fourth consecutive week, and post a 2.5% loss at the end of this month. The USD/JPY stood at 101.55 Yen, moving away from the weekly low of 101.42 Yen. The Greenback has lost nearly 0.7% for the month of May.
Euro Suffers from Easing Speculation
In the Eurozone, additional comments made by members of the European Central Bank’s governing council tended to reinforce investors’ belief that the ECB will affect some policy change to tackle the problem with low inflation and limited growth in credit facilities. The most recent comments came from board member Yves Merch. As such, the pressure on the common currency has continued to mount with the EUR/USD trading at $1.3605, just edging up on a 3-month low at $1.3586; if the pair does not recover today it will have ended the week lower for the fourth time in a row.