Mr. Japanese Yen is back to strength! After all the chatter yesterday as to what’s gonna happen during the Bank Of Japan statement on Tuesday night, it announced that it will keep the target for the BOJ monetary base as is. The central bank cut its inflation forecast for fiscal 2015 to 1 percent from 1.7 percent. The IMF earlier this week cut 2015 Japan GDP to 0.6 percent versus 0.8 percent.
Chatter has been plentiful about many statements made by bank head Haruhiko Kuroda in the BOJ press conference, mostly about time frame and rate of inflation.
So together with the mixed signals out of the US this morning during New York session, the USD/JPY pair got back inside the Ichimoku cloud and approaching our bearish target as we reported this morning.
Ms. USA (AKA US dollar) pushed lower against not only Mr. Japanese Yen but also the other major currencies on Wednesday, after the release of mixed U.S. housing reports, although she still continued to trade within close distance of recent 12-year highs.
In a report, the U.S. Commerce Department said that the number of building permits issued last month decreased by 1.9% to 1.032 million units from November’s total of 1.052 million.
Analysts expected building permits to rise by 1.3% to 1.055 million units in December.
The report also showed that U.S. housing starts rose by 4.4% last month to hit 1.089 million units from November’s total of 1.043 million units, compared to expectations for a reading of 1.040 million.
As I mentioned in yesterday’s video, a break below the 23% Fibonacci level could call for more drops in the pair in the long run, towards the 50% Fibonacci level at 111.60.
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