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Forex - USD/JPY soars ahead of G20 meeting

Published 04/16/2013, 10:08 PM
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Investing.com - The U.S. dollar has resumed its winning against the Japanese yen in Wednesday’s Asian session as traders appear increasingly comfortable that Japan will not be met with criticism at the G20 meeting that kicks off in Washington on Thursday.

In Asian trading Wednesday, USD/JPY climbed 0.71% to 98.25. The pair was likely to find support at 95.82, Monday's low and resistance at 98.85, the high of April 7.

G20 finance ministers and central bankers start a two-day meeting in the U.S. capitol Thursday. During the last G20 meeting, the other nations stopped short of censuring Japan, but warned the country to mind the weakening yen.

Export-dependent nations such as Germany, Brazil and South Korea, among others, have not been shy about vocalizing their disdain for the weaker yen. However, the yen has continued to fall this year and those declines accelerated earlier this month when the Bank of Japan unveiled new monetary stimulus efforts.

The yen’s slide was briefly interrupted Monday when a spate of concerning economic data out of the U.S. and China and plunging gold prices sent traders seeking a safe-haven alternative to the dollar. Still, the yen has slid 15% against the greenback this year and 14% against the the euro.

BoJ, lead by new Governor Haruhiko Kuroda, has pledged to keep easing until the goal of 2% inflation is achieved.

EUR/JPY soared 0.80% to 129.59 despite a bleak outlook from the International Monetary Fund regarding the euro zone economy. The IMF said said Tuesday the euro zone remains the weakest part of the global economy. IMF added in its World Economic Outlook that a prolonged period of slack growth in the euro zone will diminish the chances for expansion in Central and Eastern Europe.

EUR/JPY sought to test support at 125.00. AUD/JPY advanced 0.60% to 101.99. NZD/JPY added 0.61% to 83.40.


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