Japanese Yen Drops As Fed Comments Soothe Aggressive Tightening Concerns
The Japanese yen fell against its most major counterparts in the
Asian session on Wednesday, as Asian shares are mostly higher,
tracking gains on Wall Street overnight, following comments from
several Federal Reserve officials playing down the possibility of
aggressive rate hikes this year.
Philadelphia Fed President Patrick Harker said that he supported
four 25 basis point rate hikes for this year, but a 50 basis point
move is not preferred.
Atlanta Fed President Raphael Bostic said on Tuesday that there
is a real risk of inflation expectations drifting higher and thus
an action to reduce accommodation is required soon.
St. Louis Federal Reserve President James Bullard advocated
lifting rates at the meetings in March and May, but opposed the
idea of a half-percentage point move next month.
Investors cheered the positive earnings news and the latest data
on U.S. manufacturing and job openings showing a resilient economy.
Google parent Alphabet reported better-than-expected fourth-quarter
earnings and revenue in after-hours trading.
The yen depreciated to an 8-day low of 124.60 against the franc
and a 2-day low of 155.22 against the pound, after rising to 124.29
and 154.93, respectively in early trades. The next likely support
for the yen is seen around 126.00 against the franc and 157.00
against the pound.
The yen touched a 1-week low of 81.99 against the aussie, down
from a high of 81.66 seen at 5:00 pm ET. If the yen continues its
fall, 83.00 is possibly seen as its next support level.
The yen edged down to 129.40 against the euro and 90.51 against
the loonie, off its early highs of 129.19 and 90.34, respectively.
Next key support for the yen is likely seen around 132.00 against
the euro and 92.00 against the loonie.
In contrast, the yen advanced to 114.58 against the greenback
and 76.01 against the kiwi, following its prior low of 114.80 and a
6-day low of 76.28, respectively. The yen is seen finding
resistance around 112.5 against the greenback and 75.00 against the
Looking ahead, Eurozone CPI for January is due in the European
U.S. ADP private payrolls data for January is scheduled for
release at 8:15 am ET.
Canada building permits for December will be featured in the New
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