Euro yields to dollar rally. Bank of Japan decision keeps yen higher
The dollar continues to be the protagonist in the foreign exchange market, continuing a “rally” that has weakened the pair in which it participates with the euro. In turn, the yen also assumes a prominent role, still in the aftermath of the Bank of Japan’s intervention in the foreign exchange market to support its currency.
The euro depreciates 0.59% to 0.9778 dollars, weakening against the strength of the green note and at a time when the market and analysts (against the scenario put by the European Central Bank) believe that a recession in Europe is practically inevitable.
The Bloomberg dollar index – which compares the green note with 10 rival currencies – adds 0.49% to 111.80 points, after having been reinforced by the last meeting of the US Federal Reserve, which decided to raise rates again. interest rates, also pointing out that the easing of the increase in principal interest rates will only occur within two years.
In Japan, the yen rose for a second day, gaining 0.4% with each dollar at 141.77 yen, after rising 1.2% yesterday in the aftermath of the Bank of Japan’s foreign exchange intervention. Analysts expect the country’s monetary authority to intervene again, as the currency was being penalized by the accommodative policy of the central bank, which did not raise the reference interest rate to protect exports.
“I believe that the Government and the Bank of Japan are quite satisfied with the effectiveness [desta medida] so far”, defends Steven Englander, quoted by Bloomberg. Even so, the person responsible for the “research” of Standard Chatered for the foreign exchange market warns that the central bank “will have to be a shadow over all shorts on the yen”, in order to prevent “short-selling” from bringing the coin down again.