The Japanese yen started falling against the US dollar after a pause. The current quote is 135.02.
The morning statistics demonstrated that orders for mechanical engineering produce in Japan in April grew by 10.8% m/m, being much higher than the expected -1.5%. In yearly perspective, the index grew by 19.0% against the 5.3% y/y forecast.
No doubt that at the today’s meeting the US Federal Reserve system will lift the interest rate by at least 50 base points. Growth by 75 points is also possible. Among other things, this will mean growing pressure on the Bank of Japan. The Japanese regulator is not going to wind up the stimulation programme yet, which means the JPY will remain vulnerable.
Yesterday the Japanese authorities mentioned that they kept a close eye on the situation in the currency market and were ready to act if necessary. However, interventions are hardly possible, because they are not likely to change the circumstances around USDJPY.
It turns out that the devaluation of the yen is a lengthy process that fully depends on CB decisions.
Source: Roboforex
