Yesterday the Bank Of Japan mildly tweaked its asset purchases program. In essence the central bank applied a small reduction in the purchases of Japanese Government Bonds, around $20 Billion worth split between the 10-25 year , and the over 25 year maturities. While this does not significantly change the central bank’s policy stance, speculation from market participants ran rife as would be expected.
Primarily the move created concerns that BoJ may be considering normalising its ultra loose policy, especially considering both the Fed and the ECB have somehow already done so. All in all the move may have simply been a technical adjustment required to keep its interest-rate targeting in line.
In the meantime higher US treasury yields helped the US Dollar attain fresh session highs yesterday, however we are seeing some backtracking this morning. The most signifcant losses for the USD seem to be coming from against the JPY, as the latter garners support across the board.
EURUSD is looking past its 3 consecutive south-bound moves as we are currently experiencing some form of consolidation around 1.1937 at t he time of writing. However we still have to see how much that will last.
Realtimeforex’s TraderTip expects a drift down to first support at 1.1910 to eventually make way to a possible resumption of 1.1969 levels.
Later today we are expecting the latest data figures for UK industrial production, CAD Building Permits and US Wholesale inventories amongst others.
