G7 Meetings to Drive Dollar Trading Today

Yen weakening beneficial for Japanese companies' overseas earnings

The rise of the Japanese yen against other currencies has been checked. This is due to the wariness caused by rumours of intervention from the country's central bank. The yen fell against 15 major currencies today.

This weakening has been welcomed by Japanese companies, as it boosts their overseas earnings conversions. Companies such as Mazda, Canon and Sony saw their stocks rise on this news. The Japanese stock market also reacted positively to the yen correction, rising for the first time in 5 days.

As the yen has outperformed the dollar so far in the last week, traders were looking for news like the possible intervention to boost sentiment. A conference call of G7 finance ministers today is not likely to affect the yen, so it is up to the Japanese authorities to intervene.

The USD/JPY trading range is expected to stay between 78.00 - 78.50 levels this week.

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