Euro and dollar recover slightly against strong yen

Published: 30 May at 8 AM Tags: Euro, Dollar,

Profit booking by investors at the end of the month has halted the yen’s advancement against the euro. The single currency is worth 138.14 yen after hitting 137.98, the lowest it has been against the Japanese currency in four months. The dollar has also clawed back from a one-week low to 101.55 yen after falling to 101.42.

The recent strength of the yen has mainly been due to the fact that the Bank of Japan has shown no signs of introducing quantitative easing measures despite core consumer prices rising by 3.2 per cent during April.

Analysts have largely been ignoring disappointing economic data from the US that indicates a contraction during the last quarter. This is the first time the economy has been in decline in three years.

The euro has managed to recover slightly against the greenback after hitting a three-month low of $1.3586. The single currency is currently valued at $1.3605. The euro is likely to remain under pressure until a policy meeting at the European Central Bank on 5 June when some sort of action is expected to be announced to tackle low credit growth and low inflation.

Elsewhere, the Australian dollar is performing well and has gained 1 per cent to hit $0.9326.