The Australian dollar was trading with an increase against the yen on Wednesday against the backdrop of rising prices for commodities and stock markets. Technical charts indicate that the Australian dollar in the coming session is likely to rise against the yen to 88.50 and, possibly, to 90.00.Head of Treasury Australia Wayne Swan, presenting his fourth budget on Tuesday, said that the resource-rich Australian economy in the coming years will show strong growth due to the increasing boom in the mining sector. This will lead to a sharp decline in unemployment, high inflation and the possibility of eventually raise interest rates. Australia is the only major developed country to avoid a recession during the global financial crisis.
Reserve Bank of Australia, which last year raised interest rates four times, has warned of the possibility of further tightening policies to curb rising prices.
Nevertheless, published on Wednesday the data from China in April showed that measures to tighten monetary policy of the People's Bank of China reached the goal of reducing economic growth and price pressures. Annual inflation in consumer prices in April dropped to 5,3% from 5,4% in March. This may encourage the central bank to slow China's further tightening of monetary policy, and bodes well for the ratio of investors to take risks.
A pair of Australian dollar / Japanese yen on the daily chart are increasingly inclined to increase after the fall of May 5 to a minimum 84.30, Fibonacci retracement level at 38.2% of wave growth with a minimum of 75.00 reached on March 17, to a maximum of 90.00, reached on 11 April.
Indicator of convergence / divergence of sliding averages / MACD / points to the increasing tendency to couple the Australian dollar / Japanese yen to increase.
Slow Stochastics on the daily chart indicates an increase, indicating a continuing upward pressure on the couple.
A pair of Australian dollar / Japanese yen may rise to a maximum of 88.50, reached on April 21. Continuation of this growth in the coming session would aim at a pair of 90.00.
Nevertheless, the prospect of growing a pair of the Australian dollar / Japanese yen in the near future may be reduced to zero, if on the basis of the global session, the pair closes below 86.50, Fibonacci retracement level at 23,6%.
As at 02.50 GMT on Wednesday, a pair of the Australian dollar / Japanese yen was trading at 87.65.
