USD/JPY is still below 145.00

Source: Dukascopy Bank SA


On Wednesday, the Bank of England announced that it would buy government bonds valued at a total of 65 billion Pounds. The market took in the news as follows - the bailing out of the government will create more inflation and will force the BoE to hike rates even more intensively. As a result a surge of the GBP against the USD caused a decline of the US Dollar index. On the USD/JPY charts it resulted in a decline down to 144.00.

However, in a couple of hours the markets realized that the additional hikes by the Bank of England would result in a deeper UK economic decline in the further future. Namely, the International Monetary Fund made comments and explained how reckless the UK central bank and government were. Due to that reason, the situation, asset prices and currency exchange rates retraced back to Tuesday's levels.

In general, the USD/JPY is still standing below the 144.70/145.00 zone and the situation remains unchanged since the recovery, which followed the Bank of Japan intervention in the forex market on 22.09.2022.

A move above the 145.00 level might result in the rate finding resistance in the 145.50 and 145.75 levels. However, it is currently unclear at which point would the Bank of Japan once again intervene and beat the rate down, or would the policymakers allow the Yen to depreciate.

On the other hand, a bounce off from the resistance zone is expected to look for support in the 50-hour simple moving average and the 144.00 level. In addition, note the approaching 100 and 200-hour simple moving averages.
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Thu, 29 Sep 2022 09:00:59 GMT

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On Wednesday, the Bank of England announced that it would buy government bonds valued at a total of 65 billion Pounds. The market took in the news as follows - the bailing out of the government will create more inflation and will force the BoE to hike rates even more intensively. As a result a surge of the GBP against

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