BOJ Steps in The FX Market and Helps Japanese Economy

The Bank of Japan is ready to lead the way and help lessen the impact of the deadly novel coronavirus. The BOJ expressed their concern for the country’s economy and the performance of the Japanese yen in the FX market.

The BOJ’s head, however, said that it’s still too early for the Bank of Japan to ease its monetary policy. Governor Haruhiko Kuroda said that the bank would monitor and pay maximum attention to the developments and effects of the disease.

However, despite the rising concerns of investors, the Japanese yen still fails to gain altitude against significant currencies in sessions. The Japanese yen contract slipped by 0.11% or 0.000010 points this Tuesday in the forex exchange market.

The SARs-like virus, which originated from Wuhan, China, is believed to have massive effects on the Asian country’s affected. That, of course, means that its impact on China will be more significant than the SARS outbreak years ago.

The Japanese central bank governor said that it would affect the country’s economy and the prices of goods.

Kuroda mentioned that the Chinese economy’s presence had grown exponentially more significant, and its supply chains have reached new feats. He then added that the impact this time will also be substantial and costly.

According to the 75-year-old official, the BOJ will also work closely with other major central banks to monitor the events. He then added that the BOJ would exchange information with other authorities and nationals such as the G20.

The Japanese yen remains on the headlines of forex news outlets and heavily monitored due to its safe-haven appeal. Unfortunately, its glow is barely shining through as China holds Japan’s second-biggest export spot, putting it in line with danger.

How Poor Did the Yen Perform?

Instead of rallying and seeing green across the boards, the Japanese yen was quickly overpowered by other forex players. The US dollar stepped on the gas pedals and floored the Japanese yen on the defensive this Tuesday’s forex trading sessions.

The USD JPY exchange rate rallied about 0.35% or 0.39 points. The pair currently trades for ¥108.67 but has already reached ranges between ¥108.55 and as high as ¥109.12.

Meanwhile, the improvements from the eurozone boosted the bloc’s single currency higher against the Japanese yen. The EUR JPY trading pair rose by 0.30% or 0.36 points in trading sessions. The pair now exchanges for ¥120.53 but has extended to ranges between ¥120.06 and ¥120.68.

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