EUR/JPY Forecast for February 28, 2013

EUR/JPY Forecast for February 28, 2013

Analysis and Recommendations:

The EUR/JPY is trading at 120.21 recovering 7 pips this morning as traders took advantage of weak prices to buy up the euro. Currency speculators ran back to the yen, which is seen as a safe-haven currency, particularly versus the euro after news about the outcome of the Italian election.
The center-left coalition, vowing to continue Prime Minister Mario Monti’s austerity measures, won a majority of seats in the lower chamber of parliament, but the center-right coalition led by former Prime Minister Silvio Berlusconi, which opposes austerity measures, fared well in the Senate, leaving no bloc in control of the chamber. The election results gave rise to worries that the debt-laden country’s fiscal reconstruction efforts will stall.
Gold rebounded while the US dollar dipped after testimony from Mr. Bernanke seemed to indicate that the Fed would continue to offer stimulus. Traders pushed up gold but also sought the JPY as the favored safe haven.
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