Yen falls to a fresh 4-year low against the dollar : April 12, 2013

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Market Review - 11/04/2013 21:46

Yen falls to a fresh 4-year low against the dollar

The Japanese currency fell to a fresh near 4-year low against the greenback, on the back of stimulus measures taken by the Bank of Japan.

Although the greenback remained under pressure in Asia and briefly retreated to 99.36 in Asian morning, price rebounded to 99.77 at European open. Later, dollar met renewed selling there and dropped to session low at 99.10 in New York morning but only to rally to a fresh near 4-year high at 99.95 due to active cross-selling in yen versus other currencies, however, market was wary of option defence offers below 100.00 and price retreated to 99.68 near New York close.

The single currency traded with a firm undertone in Asia and rose in early European morning, eventually hitting a one-month high of 1.3138 on improved risk appetite due to the rise in European bourses. Despite a brief pullback to 1.3084 in New York morning, euro rose again to 1.3138 before retreating in New York afternoon.

In other European currency, despite cable's sideways trading in Asia, the pair jumped in early European morning and rose in tandem with euro to 1.5409. Cable briefly retreated to 1.5369 in New York morning before rising to a six-week high of 1.5412, then dropped to around 1.5380/85 near New York closing.

In other news, ECB said in the monthly bulletin on Thursday that 'ECB policy stance will remain accommodative, as the euro zone economy is expected to recover gradually in the second half of this year; inflation expectations in the euro area remain firmly anchored in line with its aim of maintaining inflation rates below but close to 2% over the medium term.' U.S. Treasury Secretary Lew said 'sequester is very bad policy; the sooner sequester is gone, the better for economy; US growth too low, still better than Europe's; Obama wants to make social security sound long term; income disparity in US is a real problem.'

On the data front, U.S. Labor Department reported that initial jobless claims in the U.S. decreased to 346K in the week ending April 6 of 2013 from 388K reported in the previous week.

Data to be released on Friday:

Japan tertiary industry index, France current account, Italy CPI, HICP, EU industrial production, U.S. retail sales, PPI, PPI core, U. of Michigan consumer confidence and business inventories.
 
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