Yen Weakening As Japanese Pension Funds Can Buy Foreign Bonds

The EUR/USD has been ranging today in anticipation of the interests rate decision from the European central bank expected to come out at 12:45 GMT. This decision will be followed by a press conference at 13:30 GMT. At the moment, the trajectory is changing, with the pair climbing in anticipation of these two events. However, we could see some more ranging in the moments leading up to the decision as investors struggle to predict what may happen. There has been a lot of speculation regarding negative interests rates and many are watching the ECB’s activities closely to see what they will do to deal with issues of subdued inflation. Look for support at 1.3700 and resistance at 1.3780.

The USD/JPY went down at the end of yesterday, but has been steadily rising since the Asian session this morning. The pair has been under upward pressure recently as the dollar recovers from a slight loss stemming from the crisis in Eastern Europe while the yen lost value as investors fled safe haven assets after Russia decided to refrain from further military action. The Japanese Advisory panel announced during the Asian session that the Japanese pension fund doesn’t need to focus on domestic bond anymore which put pressure on Yen. For now, the pair is continuing up due to trader speculation about the initial jobless claims data coming out at 13:30 GMT. Look for support at 102.25 and resistance at at 102.90.