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Currencies Update: Central banks decisions dragged the yen and the Australian dollar down
Written by article default Tuesday, 05 October 2010 09:30
The Asian session today witnessed several events, where the Australian central bank kept unexpectedly rates unchanged at 4.50% due to the fall in domestic demand, however signaled rising rates in the future, thereby the Australian dollar fell the most in two months.Meanwhile BoJ decided unexpectedly to lower the interest rates to a range of 0.0%-0.1% and vowed to buy government bonds and other assets worth 5 trillion yen or 60 billion dollars, as a mean to support the economic recovery since the yen’s rise damaged trade in Japan, lowering the yen sharply.
Although it started the day with some soft movement, the euro rose against the dollar recording a high of 1.3720 and a low of 1.3636, and now it trades around 1.3709. The daily hours momentum indicators indicate show the pair in an overbought area, while the four hours indicators give selling signs.
The pound fell against the dollar recording a high of 1.5842 and a low of 1.5750. The pair now trades around 1.5780. The daily and four hours momentum indicators give some neutral signs, which could bring volatility in the pair’s movement.
The yen fell considerably against the dollar following BoJ’s decision recording a high of 83.97 and a low of 83.42, and now it trades around 83.76. The daily momentum indicators show the pair in an oversold area which could support the pair’s movement to the upside.