Japanese Yen Sags Down Against Major Counterparts After Japan’s Trade Deficit Broadens
April 21, 2014 5:50 am
The yen retreats against its 16 major counterparts after a report revealed Japan’s trade deficit broadened more than projected last month.
The dollar clinched its largest weekly surge in a month against the yen and the euro ahead of leading U.S. economic indicators that may support assumptions the Federal Reserve will remove stimulus this year. New Zealand’s dollar stayed on a downbeat note before the Reserve Bank sets policy on April 24. Currency volatility pulled back to an almost seven-year low on April 17.
“Japan’s trade deficit was much larger than expected, so it helped to push the yen lower,” said Marito Ueda, senior managing director at currency-margin company FX Prime Corp. in Tokyo, “We’re likely to shift to a dollar strength story from a yen weakness story going forward as we start to see good data from the U.S.”
The yen depreciated 0.2 percent to 102.61 per dollar as of 10:04 a.m. in Tokyo from April 18, when it finalized a 0.8 percent weekly downgrade, the largest since the five days to March 21. Japan’s currency relinquished 0.2 percent to 141.69 per euro. The dollar exchanged at $1.3808 per euro from $1.3813, following a 0.5 percent weekly increase.
Monetary markets in the New Zealand, Australia, U.K., Germany and Hong Kong are among those closed for a holiday today. The U.S. markets reopen after being shut on April 18.
Missed Projections
Japan’s trade deficit broadened to 1.45 trillion yen ($14.1 billion) in March, from 802.5 billion yen the past month, the Ministry of Finance announced today. The median estimate of analysts surveyed by Bloomberg News was a 1.1 trillion yen shortfall. The deficit was a record 2.8 trillion yen in January.
In the U.S., an index of leading indicators possibly boosted 0.7 percent in March, the most since November, based from the median projection of economists in a Bloomberg survey before the data are published today.
The Fed started tapering its monthly asset purchases in January, and economists foresee that the asset-purchase program will finish in October.
Deutsche Bank AG’s Currency Volatility Index, from the three-month implied volatility on nine major currency pairs, ends at 6.52 percent on April 17, the weakest performing mark since July 2007.
The New Zealand dollar was slightly altered at 85.83 U.S. cents. It backslide 1.2 percent last week, the highest since the five days to January 31.
All 15 economists in a Bloomberg poll assumes that the Reserve Bank of New Zealand to boost its official cash rate by 25 basis points to 3 percent at the April 24 assembly. The central bank hiked borrowing costs by a quarter percentage point last month.
“The issue with New Zealand is that this forthcoming interest-rate tightening cycle is fully priced in,”Annette Beacher, the Singapore-based head of Asia-Pacific research at TD Securities Inc., said in a Bloomberg Television interview. “The Reserve Bank in March was extremely clear that 125 basis points of tightening is coming this year.”
The material has been provided by InstaForex Company – www.instaforex.com
The yen retreats against its 16 major counterparts after a report revealed Japan’s trade deficit broadened more than projected last month.
The dollar clinched its largest weekly surge in a month against the yen and the euro ahead of leading U.S. economic indicators that may support assumptions the Federal Reserve will remove stimulus this year. New Zealand’s dollar stayed on a downbeat note before the Reserve Bank sets policy on April 24. Currency volatility pulled back to an almost seven-year low on April 17.
“Japan’s trade deficit was much larger than expected, so it helped to push the yen lower,” said Marito Ueda, senior managing director at currency-margin company FX Prime Corp. in Tokyo, “We’re likely to shift to a dollar strength story from a yen weakness story going forward as we start to see good data from the U.S.”
The yen depreciated 0.2 percent to 102.61 per dollar as of 10:04 a.m. in Tokyo from April 18, when it finalized a 0.8 percent weekly downgrade, the largest since the five days to March 21. Japan’s currency relinquished 0.2 percent to 141.69 per euro. The dollar exchanged at $1.3808 per euro from $1.3813, following a 0.5 percent weekly increase.
Monetary markets in the New Zealand, Australia, U.K., Germany and Hong Kong are among those closed for a holiday today. The U.S. markets reopen after being shut on April 18.
Missed Projections
Japan’s trade deficit broadened to 1.45 trillion yen ($14.1 billion) in March, from 802.5 billion yen the past month, the Ministry of Finance announced today. The median estimate of analysts surveyed by Bloomberg News was a 1.1 trillion yen shortfall. The deficit was a record 2.8 trillion yen in January.
In the U.S., an index of leading indicators possibly boosted 0.7 percent in March, the most since November, based from the median projection of economists in a Bloomberg survey before the data are published today.
The Fed started tapering its monthly asset purchases in January, and economists foresee that the asset-purchase program will finish in October.
Deutsche Bank AG’s Currency Volatility Index, from the three-month implied volatility on nine major currency pairs, ends at 6.52 percent on April 17, the weakest performing mark since July 2007.
The New Zealand dollar was slightly altered at 85.83 U.S. cents. It backslide 1.2 percent last week, the highest since the five days to January 31.
All 15 economists in a Bloomberg poll assumes that the Reserve Bank of New Zealand to boost its official cash rate by 25 basis points to 3 percent at the April 24 assembly. The central bank hiked borrowing costs by a quarter percentage point last month.
“The issue with New Zealand is that this forthcoming interest-rate tightening cycle is fully priced in,”Annette Beacher, the Singapore-based head of Asia-Pacific research at TD Securities Inc., said in a Bloomberg Television interview. “The Reserve Bank in March was extremely clear that 125 basis points of tightening is coming this year.”
The material has been provided by InstaForex Company – www.instaforex.com
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