April 23, OctaFX – The Japanese yen strengthened after a senior Bank of Japan (BOJ) official said that the bank will be willing to ramp up stimulus ‘through a combination of steps’ if the economy loses momentum.
In a statement, Eiji Maeda, who oversees the monetary policy said that the new stimulus would take into account the impact of the economy and the banking system. He said that the bank has the tools ready in place to ease monetary policy as necessary. These tools include further lowering of interest rates, additional asset purchases and printing more money. Maeda said this a day before the bank started its two-day monetary policy meeting in Tokyo.
USDJPY technical outlook
The USDJPY pair declined to an intraday low of 111.63. This was below the important channel that the pair had created. After this drop, the pair pared some of these losses. On the chart below, this price is slightly below the middle line of the Bollinger Bands. It is also below the important 25-day moving averages while the RSI has started moving up. For the next two days, the pair will likely be a bit volatile as the BOJ makes its decision.
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