The U.S. Dollar is slipping today as investors take caution in anticipation of the Bank of Japan meeting. Many investors took profit ahead of the meeting. It’s likely that some of them will jump back in long at the sign of a bullish continuation.
It is expected that the BOJ will change their inflation target from 1 to 2% and implement additional Quantitative Easing. An Ideal rate for the USD/JPY looks to be 100. The government stated they would intervene if the Yen’s value diminished too much. Since Shinzo Abe came back into power, the Yen has weakened approximately 4.5%.
The Yen is likely to continue to weaken in the coming months. This may occur more exponentially when a new BOJ (Bank of Japan) governor comes into power.
Statements and quotes from today’s BOJ Meeting are likely to bring volatility to the market and could set the tone for which direction the USD/JPY will go this week. Will we see continued Yen weakness in the Forex Market?
Japanese is primarily an exporting company, therefore they want the Yen to be weaker. When the Yen is weaker, people will theoretically buy more from them. Therefore, Japan’s economy will strengthen.
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