Tuesday, 29 Mar 2011

Yen Drops to a 10-Month Low Versus Euro

The Japanese yen fell against most of its major currency counterparts today on speculations that central banks in Europe and the U.S. are moving closer to remove stimulus as global economy recovers.

The yen weakened today after St. Louis Federal Reserve President James Bullard said that signs of an improving economy may lead the central bank to reduce debt buying.

As a result, the Japanese currency fell to the lowest level in 10 months against the euro, as the EUR/JPY cross peaked at the 116.35 level. The yen also fell about 150 pips vs. the British pound, and the GBP/JPY cross is now trading near the 132.00 level.

Looking ahead to tomorrow, the Automatic Data Processing (ADP) will release their projection for this month's U.S. Non-Farm Payrolls figures. A positive data has potential to further weaken the yen on estimations that the world's largest economy continues to recover.