Wednesday saw the Japanese yen cease two days of gains against the world's reserve currency after the new prime minister told the governor of the central bank he wants to see the inflation goal doubled to 2 percent, Bloomberg reports.
As two days of central bank meetings await less than two weeks out, Prime Minister Shinzo Abe met with Bank of Japan Governor Masaaki Shirakawa at the Japan Council on Economic and Fiscal Policy in Tokyo. The Japanese yen lost at least 0.2 percent against all 16 of its top counterparts.
"Flows overnight suggested there was some appetite to pick up the dollar and that encouraged people back into the trade. No one is going to want to be short yen going into the BOJ meeting," European head of FX research Derek Halpenny with Bank of Tokyo-Mitsubishi told Reuters on Wednesday.
Monday and Tuesday gains for the yen against the U.S. dollar totaled 1.3 percent.
Policy makers are set to meet January 21 and 22, Reuters reports. The yen is likely to continue enduring pressure in anticipation of those meetings.
Risk Disclosure
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.
