The Yen lost 4% to the USD after the JPY currency pair closed at 104.67 in yesterday’s session. The Yen has given back at least 75% of its gains since Brexit after the elections held over the weekend gave Primeminister Abe’s ruling coalition a landslide victory. A victory that markets have interpreted as inducive to more stimulus as Abe re-enacts his economic policies. The Japanese government is promising a new stimulus package by end of month.
Overall markets have been in positive from US close till Asia this morning, as governments worldwide pledge more support in a post-brexit world and Britain is set to annoint Theresa May as the Prime Minister and in the process easing some of the concerns revolving around the UK’s political future.
The recent developemnts in the UK’s political scene helped the GBP regain some ground against bothe the Usd and the euro this week. GBPUSD is back to 1.3290 after the lows of 1.2789 last week and the EURGBP is currently at 0.8324 easing from 0.8626 last week.
Even stronger than expected US job numbers last Friday, served as a base for this risk-off trade, although clearly teh next rate rise is not a done move. The US Dollar index maintained the 96 levels this week, although we are currently at 96.42 just slightly off from Monday’s highs of 96.79.
Today’s economic docket mainly revolves around industrial production from the EZ, and a BoC interest rate decision from Canada.
