[B]Market Review - 10/04/2013[/B] [I][B]21:28[/B][/I]
[B]Japanese yen falls to a fresh 4-year low against the dollar after FOMC minutes[/B]
The Japanese currency slumped to a fresh 4-year low against the greenback, buoyed by dollar’s strength after Fed’s FOMC minutes showed some officials were keen on pulling back on its bond purchases.
Fed’s FOMC minutes stated ‘few FOMC purchases noted that curtailing QE was most direct way to mitigate costs, risks; want to bring QE to a close relatively soon, a few others felt purchase pace would likely need to be reduced before long.’
The greenback traded with a firm undertone in Asia and strengthened to 99.59 in European morning, however, price fell briefly but sharply to 98.95 after comments from BoJ Governor Haruhiko Kuroda. Dollar quickly pared intra-day losses and rebounded above Tuesday’s high at 99.67 after the Feb released its FOMC minutes ahead of schedule at 13:00GMT and showed policymakers are looking to phase out the asset-purchase program. Price eventually rose to a fresh 4-year high at 99.88 in New York afternoon.
BOJ’s Kuroda said ‘eyes 2-year time frame to meet 2 pct price target but will take steps needed until goal achieved; took all necessary steps last week to achieve 2 pct inflation target in 2 years; BOJ will scrutinise policy effects each month but doesn’t mean it will adjust policy every month.’
Although the single currency traded sideways in Asia and briefly dipped to 1.3073 ahead of European open, price rose to an intra-day high at 1.3122 in European morning. However, euro met selling interest there and dropped to session low at 1.3053 in New York morning before stabilising.
The British pound traded sideways in Asia and rose to session high at 1.5343 in early European morning but only to retreat to 1.5294 in tandem with euro at New York open. Later, price recovered to 1.5332 in New York morning before trading in a choppy fashion for rest of the U.S. session.
In other news, IMF Managing Director Christine Lagarde said ‘fiscal consolidation for Europe needed, but does not need to be brutal or abrupt; resolution process in Cyprus is no template, sets no standards; banking carries completely resolution proof.’
[B]Data to be released on Thursday : [/B]
Australia employment change, unemployment rate, Germany CPI final, HICP final, France HICP, U.S. import price index, jobless claims and Canada new housing price index.