US dollar stiffens in Sydney
In Sydney today, the US dollar went up against the Japanese Yen as well as Euro, while the investors eagerly wait for the opening of trading in Europe alongside the main German ZEW financial sentiment review for the trading month of May.Â
Richard Grace, Commonwealth Bank chief currency strategist stated that the rise in the US dollar this present week is likely to show the way to a rise in the currency pair Dollar/Yen. This is especially due the episode when the Forex markets waved off credit reduction procedures which were announced by China preceding weekend.
Forex Markets are expected to have all its focus on the commencement of the two-day conference between the vice-premier of China, Wu Yi and Henry Paulson, US treasury secretary, regarding trade issues and the yuan. This conference is to be held in Washington.
At 0346 GMT here in Sydney, the US dollar was at 121.52 Japanese Yen. The dollar had a rise from its morning trade at 121.45. The Euro is the meanwhile while was at 1.3455 US dollar, which is a little down from its earlier figure of 1.3461.
The investors are of the view that a modest reaction is what should be expected from exchange markets after the proceedings of the April meeting of Bank of Japan are made public at Tokyo at 0500 GMT, today.
These proceedings are likely to signify that the BoJ will keep the rates of interest on hold over for some of the approaching months. This kind of an event is already being broadly anticipated in the market.
Richard Grace was also of the opinion that the interest rate hike as well as the widening of the yuan trading band in China will work slightly to stimulate a main deceleration in the Chinese market and financial system.
This is because of the fact that the carry trades still remain high up as risk-taking desires of the traders has not yet been dented.