The yen has weakened a little in overnight Asian trade, with USD/JPY up at 95.60 compared to a North American close Tuesday around 95.20, while EUR/JPY is up at 134.80 from around 134.10.
The yen hasn’t been helped by the latest Japanese trade data for May, which showed exports falling 40.9% y/y after 39.1% in April, while imports slid 42.4% y/y after 41.1% the previous month. Data certainly not reflective of an economy set to rebound anytime soon.
Much talk that Japanese investors will be investing their June half-yearly bonuses on high yielding foreign assets, which will also be weighing on the yen. Sources report decent buy interest lying in wait down in the 94.50/75 area.
EUR/USD has held up well after yesterday’s strong rally. Talk of some buy stops gathering up around 1.4110.
This morning sees the ECB’s 1 year refinancing. Estimates for demand range from 300 bln euros up through 1.0 trln euros. Will be interesting to see the level of interest.
Later we have the FOMC interest rate decision with rates widely expected to be kept on hold. The market will be looking to see whether the Fed expands it’s QE programme, and interested to hear what general tone is set. Cautious I’d expect.