By TraderVox.com
Tradervox.com (Dublin) – The 17-nation currency has declined against the yen from its four months high as data from Germany is expected to reveal that the debt crisis in the region is hampering the region’s growth. The German confidence data is expected to be at its lowest levels hence pushing the euro down against most major peers. However, the demand for the yen was capped by speculation that Bank of Japan will increase the stimulus to curb the yen from strengthening. Further, fears about Spain and Greece have limited the euro’s attractiveness to investors.
Daisaku Ueno, who is a senior foreign exchange strategist in Tokyo at Mitsubishi UFJ Morgan Stanley Securities Co, noted that the euro zone economy is likely to worsen due to the austerity measures adopted by the European Central Bank. He predicted that the euro will eventually weaken as investors realize the economic woes in the region as the debt crisis is deeper than is currently being fathomed. The index of investor expectation from the ZEW Center for European Economic Research in Germany indicated a reading of -20 in September. The gauge was at -25.5 in August the worst level in a year.
The euro’s Relative Strength Index (RSI) for 14-day against the US dollar and the yen is still above 70, indicating that the asset price will reverse course in correction move. The euro has increased sharply against its peers since September 6 when the European Central Bank announce unlimited bond buying program. The advance was boosted by the Fed announcement of QE3 last week. In addition, the Bank of Japan’s meeting today has boosted speculation of intervention causing the yen to weaken.
The 17-nation currency declined against yen by 0.3 percent to trade at 102.93 yen at mid day trading today in Tokyo. The pair closed yesterday at 103.86 yen yesterday, which is the strongest since May 9. It was down by 0.1 percent against the dollar, trading at $1.3099.
Disclaimer
Tradervox.com is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at Tradervox.com are those of the individual authors and do not necessarily represent the opinion of Tradervox.com or its management.
Article provided by TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
Follow us on twitter: www.twitter.com/tradervox
