2 Jul 2013
Flash: USD/JPY uptick endemic of larger trend – Investec
FXstreet.com (New York) - The market’s en vogue currency pair USD/JPY is once again trading past the magical 100 mark for the first time in just under a month, notes Lee McDarby, Corporate Treasury at Investec.
Recently, “the volatility of the greenback against the yen is a key driver in what can happen elsewhere in the market.” McDarby adds. Dollar weakness in the middle of June when the USD/JPY traded down to 94.00 was the catalyst for the unexpected spike in GBP/USD all the way up to 1.5750.
This broadly unforecasted move last month excited a lot of UK importers who covered a great deal of exposure whilst levels were favorable. The latest bout of dollar strength which has driven the USD/JPY back up past 100 and the GBP/USD close to the 1.5100s has been due to a continued improvement in the US economy and further speculation that the Federal Reserve will soon begin tip-toeing away from quantitative easing.
Recently, “the volatility of the greenback against the yen is a key driver in what can happen elsewhere in the market.” McDarby adds. Dollar weakness in the middle of June when the USD/JPY traded down to 94.00 was the catalyst for the unexpected spike in GBP/USD all the way up to 1.5750.
This broadly unforecasted move last month excited a lot of UK importers who covered a great deal of exposure whilst levels were favorable. The latest bout of dollar strength which has driven the USD/JPY back up past 100 and the GBP/USD close to the 1.5100s has been due to a continued improvement in the US economy and further speculation that the Federal Reserve will soon begin tip-toeing away from quantitative easing.