The Japanese yen strengthened against the other major currencies in the early European session on Monday, as BOJ Governor Haruhiko Kuroda once again dispelled speculation on immediate policy easing.
Speaking at an event in Tokyo, the Bank of Japan chief Kuroda said the bank is likely to maintain status quo in the near term, as policymakers measure the effects of the recently introduced negative interest rates.
The bank will, for now, carefully study how the effects of the negative interest rates will feed into the real economy, the BoJ Governor said in response to queries regarding further easing.
The BoJ Board is scheduled to hold its policy meeting on March 14-15.
Meanwhile, the European stocks retreated after taking profit in the previous session’s rally. Meanwhile, investors were cautious ahead of the European Central Bank’s policy meeting later this week to give near-term direction.
The U.K.’s FTSE 100 index is currently down 0.55 percent or 34.13 points at 6,165, France’s CAC 40 index is down 0.56 percent or 25.13 points at 4,431 and Germany’s DAX is down 0.92 percent or 90.09 points at 9,734.
In other economic news, data from the Cabinet Office showed that Japan’s leading index declined for the third consecutive month in January to the lowest level in four years. The leading index, which measures the future economic activity, fell more-than-expected to 101.4 in January from 101.8 in December. This was the lowest reading since December 2012, when the score was 98.9. The expected reading was 101.6.
Meanwhile, the coincident index that reflects the current activity, rose to 113.8, in line with expectations, from 110.9 a month ago.
In the Asian trading today, the yen held steady against its major rivals.
In the early European trading, the yen rose to a 6-day high of 113.58 against the Swiss franc, from an early low of 114.68. The yen may test resistance near the 112.00 region.
The yen advanced to 124.28 against the euro and 160.49 against the pound, from early lows of 125.24 and 161.99, respectively. On the upside, 122.00 against the euro and 156.00 against the pound are seen as the next resistance levels for the yen.
Against the U.S., the Australian, the New Zealand and the Canadian dollars, the yen edged up to 113.49, 84.10, 76.74 and 85.02 from early lows of 113.93, 84.52, 77.44 and 85.47, respectively. If the yen extends its uptrend, it is likely to find resistance around 111.00 against the greenback, 80.00 against the aussie, 73.00 against the kiwi and 81.00 against the loonie.
Looking ahead, U.S. labour market conditions index for February and consumer credit for January are due to be released in the New York session.
At 12:00 pm ET, Federal Reserve Governor Lael Brainard speaks before the Institute of International Bankers Annual Washington Conference, in Washington DC.
Half-an-hour later, Federal Reserve Vice Chair Stanley Fischer will speak at a luncheon and receives an award at the National Association for Business Economics Annual Economic Policy Conference, in Washington DC.
Meeting of euro zone finance ministers will be held in Brussels later in the day.
The material has been provided by InstaForex Company – www.instaforex.com