USD/JPY: same old song
USD/JPY remains in range. The pair pulled down from the levels in the 120 yen area, but got support near 119.00.
Traders are already used to the picture seen at dollar/yen chart: American currency lacks strength for growth because of the weak data, while the yen is weakened by the expectations of the additional stimulus from the Bank of Japan.
On Friday, May 22, there will be a meeting of the Bank of Japan. In his last speech the head of the regulator said that he doesn’t see any immediate need for further monetary easing as the broad trend of inflation is steadily improving. As a result, we assume that this time the regulator’s policy will remain unchanged. In addition, pay attention to the release of the Japan’s Q1 GDP on Wednesday and the US statistics, especially the Fed’s meeting minutes on Wednesday and inflation figures on Friday.
Key levels for USD/JPY remain the same: 119.00 and 118.50/30 on the downside and 120.00 and 120.50/85 on the upside. The coming week will be full with economic data, so the pair will likely be trading in a more volatile way.