Market News

While the evidence continues to mount of a recovery in the U.S. economy the reverse is true in the Eurozone where new data has given rise to speculation that the European Central Bank may now move to a more aggressive easing policy to halt the slowdown

The U.S. Dollar retreated against the Japanese Yen during the Asian session but kept within striking distance of the recent 4½ year peak; the U.S.

During the Asian trading session the U.S. Dollar Index slipped off a 5-week peak as investors’ profit taking sent the greenback broadly lower ahead of inflation and other key economic data which are likely to be the impetus for a change in the Fed’s monetary policy.

The Japanese Yen slipped back from a recently struck 4½ year low versus the U.S. Dollar though additional deterioration is likely say currency analysts now that the G7 appears to have condoned the Bank of Japan’s monetary policy of aggressive easing as a statement issued by Britain’s George Osborne said only that the Group’s commitment to avoid targeting forex rates has been complied with

At long last, investors have finally seen the USD/JPY pair break through the elusive 100 level and edge even higher towards 101. Currency analysts believe that the recent signs of improvement for U.S. labor, coupled with the Federal Reserve Bank’s promise to begin curtailing its asset purchase program, has helped to restore investors’ confidence in the U.S. economic recovery.

The release of unexpectedly improved March factory activity figures from Germany gave a lift to the common currency which stayed close to a 1-week peak against the greenback

A day following the Reserve Bank of Australia’s rate cutting announcement which sent the Australian Dollar markedly lower, the Aussie gets a reprieve on unexpectedly improved trade data from China which is its primary export destination.

As reported at 10:36 a.m. (JST) in Tokyo, the EUR/USD pair had been trading at a session low of $1.3053, well below Monday’s peak of $1.3141; it has since recovered and is holding at $1.3081. The full story is here.

The U.S. Dollar edged up against the Japanese Yen during Monday’s Asian trading session, the USD/JPY pair was able to gain additional traction after the U.S. labor report for April came in last Friday with unexpected improvements in the numbers.

The Euro fell hard after the European Central Bank announced yesterday that it would lower its benchmark rate by 0.25% to 0.5%. While some analysts had expected the ECB would hold off on a rate cut this time around, the consensus opinion was that the rate cut was long overdue.

The Federal Reserve’s Federal Open Market Committee announced on Wednesday that it would leave monetary policy unchanged in order to give the U.S. economy time to improve; the statement also cited a too high unemployment rate.

The U.S. Dollar Index continued to hold close to a 2-month low as investors gauge that the Federal Reserve’s response to lackluster economic data will either be a recommitment of its existing ultra-loose monetary policy or the promise of even more stimulus.

The U.S. Dollar Index held close to a 2-week trough earlier as investors anticipate that a decline in U.S. Treasury bond yields and a slowdown in consumer inflation rates could pressure the Federal Open Market Committee to act more aggressively.

Unexpectedly disappointing growth data from the U.S. on Friday led to the greenback’s broad fall during the Asian trading session. According to the report issued by the U.S. Bureau of Economic Analysis, growth during the first quarter of 2013 rose only to 2.5% against expectations of a rise to 3.0% annually.

The U.S. Dollar was trading near to a 4-year peak versus the Japanese yen following unexpectedly strong jobless claims data eased investors’ concerns over the global economic slowdown.