USD/JPY and JPY crosses traded up for the most part in Asia on the back of strong demand out of Japan. From an early low in the 117.85/90 area, USD/JPY traded back above 118.00. It looked to have topped out initially around 118.25 but rallied further to 118.70/75 before edging back.
Interest was especially strong ahead of the Tokyo fix with Japanese importers buying quite a bit for month-end settlements. Investment trust-related demand was also strong on fresh and on-going launches. Retail margin players were also big buyers. With USD/JPY at levels not seen since mid-December, demand today was not all that surprising. Shorts taking profits were also seen as well as foreign investors squaring up long Japanese equity positions.
The bias does look to remain to the downside near-term however with more carry trade liquidation eyed ahead. Some Japanese institutional investors were also see putting on fresh hedges. EUR/JPY rose from early lows around 156.15 to as high as 156.85/90 before easing back, GBP/JPY from 231.40 to 233, AUD/JPY from around 92.80 towards 93.50 and NZD/JPY from 82.40 to 83.20.
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