Role of Central Banks in Currency rates II In continuation with the previous article, role of CBs decides the movement and even it changes the trend. In continuation with the previous article, role of CBs decides the movement and even it changes the trend. Infact some CBs are proactive and some CBs some what late in setting the policy. SNB had come forward independently and fixed EUR / CHF floor of 1.2. At that time there was only huge movements in that pair and was threatening and there was a fear of deflation. But once the floor was put in place, the pair was very steady and it helped the swiss economy in a very big way . Same with BOJ. But in real terms they lagged some what due to fluid political scene. Once the strong government was elected and the PM Abe has indicated his desire to defeat the YEN strength, it is weakening day by day. Here no indicators work. No Holy grail here! Thatswhy even all the pull backs till now are shallow and prices are quickly jumping up. It is a trend change. Prices will correct for a overbought level. But only to some extent. If it has to correct technically, EUR/JPY needs to go 117, USD/JPY to 82 to name a few. Today’s sudden jump in al…
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