28 May 2014
USD/JPY well supported near 100.00 - BTMU
FXStreet (Barcelona) - Derek Halpenny, European Head of Currency Strategy at the Bank of Tokyo Mitsubishi UFJ, observes strong support in the 100.00 area.
Key Quotes
"Optimism in Japan does appear to be rising ahead of a key month of policy announcements with the Topix Index up 4.2% over the last week. The closing level today is the highest since 4th April."
"The S&P 500 is up a much more modest 1.2% over the same period. One of the factors helping to support the yen has been the notable under-performance of the Japanese equity markets relative to the US and hence this recent performance of the Japanese equity markets is worth watching as it may signal some scope for renewed yen selling if sustained."
"Friday is a key day for the yen with April nationwide inflation data and the employment report. The jobs-to-applicant ratio is just below the pre-crisis cyclical high of 1.08 and hence we are close to getting a jobs-to-applicant reading that we haven’t seen since the early 1990s which would further highlight the potential for wage inflation to play a more important role in lifting inflation given the impetus from yen depreciation is now fading. USD/JPY will likely continue to find strong support on any near-term dips back toward the 100.00 level."
Key Quotes
"Optimism in Japan does appear to be rising ahead of a key month of policy announcements with the Topix Index up 4.2% over the last week. The closing level today is the highest since 4th April."
"The S&P 500 is up a much more modest 1.2% over the same period. One of the factors helping to support the yen has been the notable under-performance of the Japanese equity markets relative to the US and hence this recent performance of the Japanese equity markets is worth watching as it may signal some scope for renewed yen selling if sustained."
"Friday is a key day for the yen with April nationwide inflation data and the employment report. The jobs-to-applicant ratio is just below the pre-crisis cyclical high of 1.08 and hence we are close to getting a jobs-to-applicant reading that we haven’t seen since the early 1990s which would further highlight the potential for wage inflation to play a more important role in lifting inflation given the impetus from yen depreciation is now fading. USD/JPY will likely continue to find strong support on any near-term dips back toward the 100.00 level."