The Japanese yen was weak across the board today. Analysts provided various possible reasons for the currency’s extremely poor performance.
Some market analysts argued that the yen was soft because of the crude oil rally following the announcement that the United States are pulling back from the Iranian nuclear deal. The higher prices for crude made more attractive riskier currencies related to commodities, while sapping strength from safer currencies.
Others pointed at the outlook for Federal Reserve’s monetary policy as a possible reason for the yen’s softness. The policy divergence between central banks of the USA and Japan made traders prefer the dollar over the yen.
As for today’s macroeconomic releases in Japan, they were mixed. The Ministry of Health, Labour and Welfare reported that average cash earnings increased by 2.1% in March from the previous year, almost two times the forecast increase by 1.1%. Meanwhile, the leading indicator provided by the Cabinet Office slipped from 105.9 in February to 105.0 in March, slightly below the forecast figure of 105.2.
USD/JPY climbed from 109.12 to 109.63 as of 10:46 GMT today. EUR/JPY rallied from 129.42 to 130.10. GBP/JPY advanced from 147.82 to 148.53.
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