The Yen improved significantly. Overview for 09.01.2018

The USD/JPY pair plummeted on Tuesday morning after decisions made by the Bank of Japan.

On Tuesday, the Japanese Yen is quickly strengthening against the USD. The current quote for the instrument is 112.60.

The main reason why the Yen moved upwards was the decision made by the Bank of Japan this morning. The regulator decided to limit buying 10-y and 25-y bonds. This decision was taken by investors as a signal of closing the QE program soon. The number specified by the BoJ wasn’t very significant, but investors were very interested in the fact that the regulator would do it.

The timing was perfect: yesterday, Japan had a day off due to the national holiday and all market players were back to the market this morning. This is why reactions to the regulator’s decision were so active.

The Bank of Japan is very unlikely to comment on its actions right now, especially when there are no talks about closing the QE program. The regulator emphasized on several occasions that only the QE program and long-term support from the national Central Bank and Ministry of Finance prop up the Japanese economy.

RoboForex Analytical Department