The Yen Rebounded And Gold Prices Broke.

In the foreign exchange market, the yen rebounded against the US dollar on Wednesday, after the Bank of Japan maintained its main monetary stimulus policy. The speculators who had previously betting the central bank to further relax their policies refunded the short yen positions.

Gold rose by more than $1300 an ounce on Wednesday, reaching a five month high, triggered by a weaker dollar, global economic misgivings and uncertainty about whether the European Central Bank (ECB) would announce stimulus measures.

Financial markets have been waiting cautiously for Thursday's ECB meeting.

It is widely expected that the central bank will announce quantitative easing measures.

Instead of further expanding the scale of the bond buying stimulus, the Bank of Japan chose to expand the loan scheme to promote lending in the banking sector.

The central bank also lowered its core inflation rate from three to 1.7% a month ago, mainly due to the collapse of global oil prices.

The US dollar against the yen fell by more than 1% to 117.76, basically reflecting the overnight rise, dropping to 115.85 in recent months and a month low.

The dollar was 118.87 higher in the overnight market against the yen, selling yen due to investor protection against the relaxation of the BoJ's policy.

Yamamoto Masamitsu, head of marketing strategy at Praevidentia Strategy, said: "the expectations of the BoJ will be lower than before, so the appreciation of the yen is reasonable. The Bank of Japan has also lowered the 2015 CPI projection and strengthened the expectation that its policy will be relaxed again in the future."

With the decision of the BoJ to settle, the focus of the market will now shift completely to the European Central Bank.

The latter is expected to offer a debt purchase plan on Thursday to counter deflation and stimulate the economy.

However, the euro rebounded against the US dollar and is now trading at 1.1580 front-line, not far from 1.1459 in last week's 11 year low.

The euro's fluctuation before the resolution shows that investors are still more cautious before the formal resolution of the euro bank resolution.

Other

In the meantime, the New York stock market has seen a poor performance since the end of the New York stock market. The country's fourth quarter consumer price index (CPI) was 0.8% higher than the same period last year, lower than market expectations, and lower than the 1% expected by the New Zealand Federal Reserve.

After the release of the data, NZD fell to 0.7628 against the US dollar, close to January 5th and 2015 low 0.7616.

Weak data means that the New Zealand Federal Reserve is unlikely to carry out major projects this year.

This dispelled expectations that the central bank could restart its tightening cycle in 2015.

In the evening, the Bank of England will announce the latest meeting minutes, and the Central Bank of Canada will announce the January interest rate resolution, which is worth paying close attention to by investors.

The pound remained stable during the day as the market expected that British employment figures released at 17:30 would be good.

According to insiders, interest rate hikes are still the main focus of the meeting. Especially after inflation in Britain has dropped to a 12 year low, central bank officials' views on inflation may be expected to raise interest rates.

As inflation in Britain has been slowed down by a sharp slowdown in energy prices and uncertainty in economic growth prospects, the market has pushed the Bank of England's interest rate hike forecast to the end of 2015 to the beginning of 2016.

However, analysts and traders expect that at least one to two of the nine members of the Bank of England Monetary Policy Committee voted to raise interest rates at this month's meeting.

The US dollar hovered around 1.2075 in the Canadian dollar.

The Central Bank of Canada will announce the January interest rate resolution at 23 on Wednesday, Beijing time.

At present, Bank of America Merrill Lynch estimated that the Central Bank of Canada may not give any hint of interest rate cuts this time.

Before that, the Canadian Central Bank (BOC) maintained the 1% benchmark interest rate in the December 3rd interest rate resolution. As expected, the Canadian economic recovery spread to the areas of export and business investment. Stronger exports began to be reflected in the improvement of business investment and employment. This means that the long-awaited balance of self sustained growth order may finally start.