Dollar/yen is trading in an erratic manner, to say the least. The pair currently trades at 105.45, around 80 pips higher on the day, but this does not tell the full story. USD/JPY shot up as high as 106.54 before falling to 105 and bouncing again.
There are conflicting reports about the potential for fiscal and monetary stimulus ahead of the BOJ decision on Friday.
- 50 years bond: A long-term government bond could be a good substitute against a “perpetual bond“, aka helicopter money. The news popped on the wires but denied by the Ministry of Finance.
- 28 trillion yen stimulus: This sum is closer to the talk that pushed the pair higher before much lower numbers sent it lower. PM Shinzo Abe is expected to announce this according to Jiji.
Here is how it looks on the 30 minute chart. 104 is support on the downside and 107.50 on the topside. The next event is the actual press conference from Abe and of course, the BOJ decision early on Friday.
It seems that the madness in yen trading could overshadow today’s FOMC meeting. Here are 3 Fed previews.
Helicopter money cannot be ruled out, but it may have to wait.
