On Thursday the euro advanced to four-month highs versus the US dollar, as the greenbacks weakness against the Japanese yen caused dollars decline versus other major peers.
EUR/USD hit a session high at 1.3391 during the later hours of Asian trade, highest value since February 20th, after which consolidation followed at 1.3355. Support was expected at Wednesdays low, 1.3264, while resistance was to be met at February 20th high, 1.3434.
The dollar crumbled more than 2% against the Japanese yen on Thursday after the sharp decline in Japanese shares overnight and at the same time concerns over the prospects of an exit to the central bank stimulus triggered a broad sell-off in both risk assets and the US dollar.
Earlier this week the Bank of Japan disappointed expectations by not taking measures to ease volatility in the government bond market.
Since Bank of Japan abstained from action and expectations grew that the Federal Reserve Bank will begin to taper its asset purchases later in the year, fears appeared what will be the future of central bank stimulus programs.
Meanwhile, the euro lowered significantly against the yen, with EUR/JPY pair down by 1.74% to 125.79.
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