EUR/USD (a 4-hour chart)
The UK continues to impress investors. The data for the level of unemployment published the day before point at the recovery of the labor market: unemployment decreased to 7.1% in November, having come close to the target level 7%. Amid this positive background GBP/USD quotation jumped up immediately having overcome several resistances. The transactions of the latest Bank of England meeting did not spoil the mood of “bulls”. The regulator said that there was no need to raise interest rates after the targeted unemployment level would be achieved.
The Bank of Japan held its regular meeting on Wednesday. There were no changes in the monetary policy announcement; it disappointed slightly investors who had expected to hear hints at increasing the incentive measures. The regulator has said that the spring of the wages growth was expected, which would have a positive impact on inflation; and by the end of a fiscal year 2014 we could reach inflation of 2%.
Higher sales tax will impact on the rate of economic growth, but the management of the Bank of Japan does not see any seriously negative effect. As a result the “bulls” and “bears” came into serious battle at the Asian trading session. As we see the bears won that battle.