Forex News
May 27, 2013 @ 1:13 pm

Yen firm for third day against dollar

The dollar was trading close to two-week lows against the yen on Monday as volume remained thin due to closed markets in the UK and US.

Bank of Japan Governor Kuroda made remarks yesterday that he believes that if interest rates rise as much as 3 percent the economy will not be effected drastically.

Meanwhile, the policy meeting minutes of the Bank of Japan’s April meeting showed that a “few” policymakers are concerned that inflation may fall short of the bank’s 2 percent target through March 2016.

The Nikkei extended last week’s sharp decline as the firm yen is not good for export companies.

Adding to the increasing divergence between yen and dollar is concerns that the Federal Reserve could begin to scale back its USD85 billion-dollar-a-month asset purchase program later this year.

By the European session USDJPY was down 0.3 percent to around 100.90.

EURUSD remained steady due to limited news flow from Europe and holiday-thinned trading, with the pair inching up to trade above $1.2940.

The dollar slid slightly against the pound and the Swiss franc. GBPUSD edged up 0.06 percent to $1.5132 and USDCHF slipped to 0.9591 before recovering to 0.9634.

The USD was little changed against its Australian counterpart. AUDUSD rose 0.01 percent to 0.9651.

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